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At the end of World War II, our nation was broke. The money owed by our government exceeded the nation’s GDP (Gross Domestic Product) by 20 percent. We literally owed more than we produced in an entire year.
And yet times were good. The nation found itself in an era of prosperity, and the National Debt was a topic of rare discussion.
You would think that enduring a debt of $259 billion would paralyze a rational thinker. But society is oddly capable of burying concerns like this along with the tens of millions killed, and moving forward with its focus on commerce and industry.
If people had in fact been more conscious of the debt, they may not have actually minded. For you see, the nation was growing (both in population and in power) and the National Debt was shrinking.
Well, for a few years anyway. From 1945-1948, the National Debt declined to $252 billion. Back then, people laughed when politicians boasted of the debt’s decline, noting that a 7 percent decrease was nothing to brag about. But today having the debt shrink by 7 percent would be earth shattering news.
And then, it began to rise. But so did the GDP, and so from 1945-1979, we enjoyed a steady decline in the ND/GDP ratio, reaching a low of 31 percent near the end of President Jimmy Carter’s term. At that time, our National Debt was a “pleasant” $827 billion.
Enter Ronald Reagan and trickle down economics, a rainfall of monumental idiocy and unbounded greed. Within eight years, the National Debt had tripled, increasing to $2.4 trillion, and the ND/GDP ratio had increased to 48 percent.
The word “trillion” was scarcely used before the 1980s. Just writing it out, a ‘1’ with 12 0s after it, was mind numbing.
But today, numbing minds run the country and the word “trillion” rolls off the tongue like water off a duck.
Our National Debt is now over $17.5 trillion and increasingly at a startling rate. In fact, we’re rapidly approaching post-WWII measures.
The ND/GDP ratio is now 99 percent.
We’ll probably hit the $20 trillion mark sometime in 2016.
It would be easy for one to blame the Republicans for starting this fire, but the Democrats are equally to blame. It’s true that the ND/GDP ratio declined during President Bill Clinton’s terms (from 62 percent to 55 percent), and it’s true that reduction of taxes on the uber-rich has had a huge negative impact.
But government spending is out of control, billionaires are buying politicians, the rich pay less and less, and neither the Republicans nor Democrats in Congress know how to balance a checkbook.
We have approximately 320 million people in America. Our National Debt equates to a share of over $55,000 per person. A family of four owes $220,000. With a median household income of $44,389, that family would take five years to pay off their debt.
Of course, that’s assuming that they didn’t pay a single penny in taxes and didn’t spend a single penny on food or utilities or anything else you might need to live.
In 1989, the National Debt Clock was first installed by Seymour Durst, a real state investor who wanted to promote more visibility to the dangers of the increasing debt. When first turned on, the clock depicted a debt of just under $3 trillion, a terrifyingly huge number, but not as terrifying as how fast it grew.
A person needs to study exponential equations to understand the true ramifications of this rate of increase. The debt is increasing at a rate of approximately $32,000 per second.
That figure should take your breath away. Hold your breath for 10 seconds and consider the fact that we’re a third of a million dollars more in debt.
The question is, is the sky truly the limit? Or should we sit back and let things ride until Seymour’s clock runs out of zeros?
Politicians are quick to levy blame for this situation, but none of them actually have a solution. They’ll say anything to get elected, but only one thing is guaranteed.
The debt will get a lot bigger before it, well, before it gets even bigger.