If ever there was a time when Americans should feel they are being nickeled and dimed that time is now! The national debt, in round numbers, has topped 15 Trillion dollars. Congress, you may recall, has set up a Super Committee to hammer out 1.2 Trillion Dollars in cuts to the national debt. Of course these numbers are astronomical for most of us, I mean, when was the last time you wrote a check with 12 zeros after the number? Not lately? Well, your Congress has been writing checks with 12 zeros after the number for quite some time now. As a result the national debt is over 15 Trillion Dollars. But, as I wrote a moment ago those numbers are difficult to imagine for most us on Main Street. So I decided to make those numbers “talk” to us and make sense of them.
Let’s begin with the national debt. How much do you owe? Clearly you don’t owe all of it but you do owe some of it, how much? Your share is $48,000.00 and growing. Of course if you remove all of the none tax paying citizens from the debt owed, tax paying citizens then owe a whopping $133,000.00 each! Now think about this for a moment. the debt, eventually, has to be paid. The government can only pay this debt by getting the money from taxpayers, i.e. you! So, to put this in understandable terms let’s assume the following scenario; you are employed and are earning $15.00 per hour. In order to pay your individual share of the debt, the $48,000.00 you would have to work 3200 hours and give every cent to the government. If you get stuck paying back the $133,000.00 then the hours worked jumps to 8866. Of course there is a problem with this scenario. Perhaps you have figured it out. If you work a standard 40 hour work week then you would have to work 80 weeks to pay the $48,000.00 and 221 weeks to pay the $133,000.00. That’s assuming you gave every dollar earned to pay off the debt.
Of course no one talks about paying off the actual debt instead they talk about paying the interest on it. So let’s talk about that, the interest payments we are making. The national debt is growing by over 4 billion dollars a day. If you break that number down you will find that the Federal Government is still borrowing about 168 million dollars every hour or about 2 million a minute! The cost for all of this borrowing? Approximately 400 billion dollars a year give or take a few billion. And who pays for this?
Now, let’s put the Super Committees goal of cutting the budget into perspective. It is true that the committee is looking at cutting about 1.2 trillion dollars out of the budget. At first blush that looks like a lot of money. But. There’s always a but when you are talking about Congress. The “savings”, the 1.2 trillion dollars is spread over 10 years! Hmmmm? So then that means the annual savings would be just over 100 billion dollars. So then, why is Congress, and the Super Committee struggling over cutting the budget? If they simply cut about 8 cents out of every dollar spent that would be a meaningful cut, that’s it, about 8 cents, that’s somewhere between a nickel and a dime! They simply can’t seem to do it. Why?
Look, if they really meant business about reducing the deficit all they have to do is one thing; freeze present spending for the next ten years! That’s it. They wouldn’t have to cut anything. All they have to do is stop spending more and more, freeze Federal spending at its present levels.
Will they? No. The only “fix” is to rout the present office holders and replace them with new ones. Oh, one more thing, go to term limits to prevent the new bunch from becoming tainted.
Hal
