The United States of Debt: Our debt is $18 Trillion and we're still borrowing, no matter the party

Sorry, but this one you can’t blame on either party. Yes, President Obama has made the problem much, much worse, but the scary truth is that the national debt keeps rising inexorably no matter who or which party is in office. That’s the new law of American politics.

When I first arrived in Washington in the early 1980s, the debt was roughly $2 trillion. This week, 30 years and five presidents later, the debt for the first time exceeded $18 trillion. We have been in the red in all but four of the last 40 years.

That’s $18,000,000,000,000. We all know that $18 million is a lot of money. This is $18 million times another million. The number is so gigantic we won’t or can’t try to fathom it.

Why worry? We owe it to ourselves, we’re told. The mighty American economy is big enough to absorb it. This country was built on debt. There is no better time to borrow than when interest rates are at a 40-year low.

There’s some truth in all these claims. Sure, we have a near–$18 trillion economy, but the problem is that the debt is outgrowing the economy. In just the last seven years — the last year of George W. Bush’s presidency and the first six of Obama’s — the debt has increased by roughly $7.4 trillion. That’s ten times the entire debt incurred in our first 200 years as a nation.

My view is that government debt isn’t inherently evil. The wisdom of borrowing depends on what you use the money for. We borrowed trillions (in today’s dollars) to win World War II. Surely that was worth it. We borrowed another $1.8 trillion during the Reagan years to finance winning the Cold War and rebuilding the private economy with growth-hormone tax cuts. That has clearly benefited future generations — so they should bear some of the cost.

But what we have bought with most of our debt of the last two decades has been a bigger, more expansive welfare state. Almost half of all American households, according to the Census Bureau, get a government check or some direct benefit from government today. More than one-third of households get some kind of unearned welfare.

Obama called his spend-and-borrow policies a “stimulus.” Really? What do we have to show for Obama’s debt? Solyndra. Forty-six million people on food stamps. The Obamacare debacle. Etc. Etc. This is one of only two times in American history (the post–Vietnam War era is the other) that we have opened up the flood gates on borrowing even as we have severely slashed the military budget.

Here is the biggest worry about an $18 trillion debt: What happens if/when interest rates start to drift back upward? Answer: This is the economic equivalent of the nuclear option.

Each 1-percentage-point rise in interest rates causes the U.S. deficit to rise by more than $1 trillion over ten years. So a 300-basis-point rise in rates — nothing more than a return to normalcy — would mean about $5 trillion in federal deficits.

If that happens, the debt-servicing costs grow astronomically and interest payments would become the biggest expense item in the budget. We start to pay more and more taxes just to finance past borrowing. This is what happened in Detroit; look at how that turned out.

Maybe this debt bubble won’t burst. Let’s pray that it doesn’t. If it does, the 2008–09 real-estate crash could look like a picnic by comparison.

The politicians think they are pulling a fast one here, but the vast majority of Americans feel in their gut that the economy is headed in the wrong direction, in no small part because of this debt time bomb. It explains why Barack Obama’s policies were so thoroughly routed during November’s midterm elections. A great nation doesn’t ring up unpaid bills month after month, year after year, decade after decade. The basic common sense of Americans tells us that you don’t borrow your way to prosperity.

Oh, and we’re still borrowing half a trillion a year, so the debt will likely hit $20 trillion sometime before 2018. Have a nice day.

Major provisions of $1.1 trillion spending bill http://www.twincities.com/nation/ci_27106824/major-provisions-1-1-trillion-spending-bill Home →Nation & WorldStory Print Email Font Resize Major provisions of $1.1 trillion spending bill By The Associated PressPosted: 12/10/2014 02:23:41 AM CST | Updated: about 7 hours ago Top lawmakers Tuesday released a massive 1,603-page, $1.1 trillion omnibus spending bill funding every government agency but the Homeland Security Department through Sept. 30, 2015. The measure also contains dozens of policy provisions affecting financial regulations, the environment, school lunches and regulations requiring truckers get more rest. Provisions include: SPENDING — Overall spending. $1.013 trillion for core agency budgets for day-to-day operations, with $521 billion for defense and $492 billion for non-defense. That represents about one-third of the federal budget and is essentially a freeze at current levels. Another $64 billion is provided for overseas military operations. — Defense. Provides a base budget of $490 billion to the Pentagon, a $3.3 billion increase. Maintaining 1.3 million active-duty troops and 820,800 reserves would cost $128 billion. Another $162 billion is provided for operations and maintenance; procurement of new weapons systems, including 38 new F-35 fighters, totals $92 billion. — Overseas military operations. Provides $73.7 billion for overseas military operations and diplomatic efforts by the State Department to combat terrorism, including $3.4 billion to continue the air campaign against Islamic State militants and $1.6 billion to train the Iraqi military. Provides $4.1 billion to train and equip Afghanistan's military. — Homeland Security. Keeps the Homeland Security Department funded at current levels through Feb. 27. Its budget will be revisited next year when Republicans are hoping to roll back President Barack Obama's recent moves on immigration. — Ebola. Provides $5.4 billion of President Barack Obama's $6.2 billion request to fight Ebola at home and abroad; $2.5 billion of the total would help African countries fight the disease, while $2.7 billion would go to the Health and Human Services Department, including $1.2 billion for Center for Disease Control and Prevention efforts to stop Ebola in West Africa and strengthen public health systems in at-risk countries. — Foreign aid. Provides $49 billion for foreign aid programs, an almost $3 billion increase. Some $6 billion would help fight HIV/AIDS overseas, while $7.2 billion would be for economic and development programs. Israel would receive $3.1 billion in military aid; Egypt would receive $1.3 billion in military aid and $150 million in economic assistance. The Millennium Challenge Corporation, which directs aid to countries demonstrating economic and social progress, would receive $900 million. — Environmental Protection Agency. Cuts the EPA budget by $60 million to $8.1 billion, or 21 percent below peak levels in 2010. — Internal Revenue Service. Cuts the IRS by $346 million to $10.9 billion. Blocks the agency from targeting tea party organizations and other advocacy groups seeking tax-exempt status based on their ideology. — Transportation. Provides $71 billion for transportation programs, including $40 billion in highway funding for states. Aid to Amtrak would be maintained at $1.4 billion. — Housing. Provides $26 billion for Section 8 and other public housing programs for the poor. Add $10 billion for other housing programs, including help for the elderly and disabled. — Crime-fighting. Provides $8.4 billion for the FBI, a slight increase; $2.4 billion for the Drug Enforcement Administration; $1.2 billion for the Bureau of Alcohol, Tobacco, Firearms and Explosives; and $2.3 billion for various grants to state and local law enforcement. — NASA. The space program would receive $18 billion, a $364 million increase. Of that, $4.4 billion is provided for the new Orion space-launch system, which last week had its first test launch. — Food Aid. Provides $82 billion for food stamps as required by law; allots another $6.6 billion for a program that provides food aid to pregnant and nursing mothers and their young children. Another $21 billion goes to mandatory funding for the school lunch program and child nutrition programs. Capitol Dome. Provides $21 million to continue a project restoring the iconic cast-iron Capitol Dome, which is beset by crack and leaks. POLICY 'RIDERS' — Likely to be amended to include legislation aimed at shoring up underfunded multiemployer pension plans, including a controversial provision that permits them to cut the benefits of current and future retirees to shore up severely distressed plans. — Eases regulations under the 2010 Dodd-Frank overhaul of financial regulations that require banks to set up separately capitalized affiliates — ineligible for federal benefits such as deposit insurance — to deal in more exotic and riskier forms of complex financial instruments called swaps. Regulators could still "push-out" risky swaps based on asset-backed securities. — Blocks new Transportation Department regulations that require truckers to get two nights of sleep before restarting the clock on their workweek. One effect of the rule was to shorten the maximum length of a trucker's workweek from 82 hours to 70 hours. — Relaxes rules slated to go into effect in 2017 that require more whole grains in school foods. Put off rules to lower sodium in school meals that were supposed to go into effect in 2017. — Prohibits the use of federal or local funds from implementing a referendum legalizing recreational marijuana use in Washington, D.C. — Blocks the Fish and Wildlife Service from placing the Sage Grouse on the Endangered Species list, which Republicans claim will have economic benefits for Western states. — Blocks the Justice Department from raiding medical marijuana dispensaries in states where they are permitted. — Prohibits the use of funds for a "National Roadside Survey" by the National Highway Transportation Safety Administration. — Bars funding for renovation of the United Nations Headquarters in New York, a new London embassy and debt relief for foreign countries. — Withholds money from the U.N. population fund, dollar for dollar, if it operates a program in China. — Prohibits the transfer or release of detainees held at the prison at Guantanamo Bay, Cuba; also bans construction of facilities to hold detainees within the U.S. Prohibits funding for the administration "light bulb standard," which prevents the manufacture or sale of incandescent bulbs. — Bars funding for the White House to order the IRS to determine the tax-exempt status of an organization. — Prohibits the use of funds for painting portraits. — Prohibits the Environmental Protection Agency from regulating lead in ammunition or fishing tackle.

The crowning stated purpose of the U.S. Constitution is "To secure the Blessings of Liberty to Posterity."

Running up debts that our own generation cannot possibly repay does violence to that supreme purpose.

In other words, it's fundamentally unconstitutional, as unconstitutional as something can possibly be.

We are robbing our posterity of their God-given, unalienable right to government by consent.

We're making slaves out of our own grandchidren.

A shameful inheritance to leave behind, especially when you consider the extreme price our forebears paid to leave us a heritage of liberty.

"There are two ways to conquer and enslave a nation. One is by the sword and the other is by debt."
-- John Adams, 1826
"The principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale."
-- Thomas Jefferson, letter to John Taylor, 1816
"[With the decline of society] begins, indeed, the bellum omnium in omnia [war of all against all], which some philosophers observing to be so general in this world, have mistaken it for the natural, instead of the abusive state of man. And the fore horse of this frightful team is public debt. Taxation follows that, and in its train wretchedness and oppression."
-- Thomas Jefferson to Samuel Kercheval, 1816
"To preserve independence, we must not let our rulers load us with perpetual debt. We must make our election between economy and liberty, or profusion and servitude. If we run into such debts as that we must be taxed in our meat and in our drink, in our necessaries and our comforts, in our labors and our amusements, for our callings and our creeds, as the people of England are, our people, like them, must come to labor sixteen hours in the twenty-four, give the earnings of fifteen of these to the government for their debts and daily expenses, and the sixteenth being insufficient to afford us bread, we must live, as they now do, on oatmeal and potatoes, have no time to think, no means of calling the mismanagers to account, but be glad to obtain subsistence by hiring ourselves to rivet their chains on the necks of our fellow-sufferers."
-- Thomas Jefferson, to Samuel Kercheval, 1816
"It is incumbent on every generation to pay its own debts as it goes."
-- Thomas Jefferson

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