Ballooning Debt: A Threat To America's Future

This month America likely will bump up against the Congressional mandated debt ceiling of $20.1 trillion.  If the past is a harbinger of the future, lawmakers and the president will increase the nation's borrowing limit rather than deal with the smoldering financial caldron.

On March 1, the nation's debt teetered at $19.9 trillion.  But America borrows $100 million every hour of every day to pay for federal budget expenses.  At that rate, the debt will nick the $20.1 trillion cap on March 16.  Unless Congress lifts the limit, America cannot borrow another penny.

How did the United States reach this financial precipice?

Blame it on Washington lawmakers' insatiable appetite for spending. Since 2000, the federal budget has more than doubled from $1.78 trillion to $4.15 trillion for fiscal 2017. America's debt has nearly quadrupled during the same time frame, soaring from $5.6 trillion to nearly $20 trillion.

The federal government is spending more than it confiscates in taxes from Americans.  The result is a deficit.  To make up for the gap, Washington must borrow ever increasing amounts of money to fund the federal budget.  Both political parties have done little more than pay lip service to the problem.

Despite sharp increases in borrowing, the net interest paid by the feds has remained essentially flat over the last few years, thanks to the Federal Reserve's politically-driven policy of artificially holding down interest rates. Last year's tab for interest on borrowed money was $432 billion.

However, interest rates are ticking upward, which will make it more costly to borrow money to fund the government.

Despite repeated dire warnings, there never appears to be any sense of urgency in Washington to pay down the debt and rein in spending. Former President Obama was the most recent chief executive to sound the alarm about the albatross of debt draped around the neck of U.S. fiscal policy.

At the beginning of his first term, Mr. Obama pledged to tackle government spending.  "I refuse to leave our children with a debt they cannot repay--and that means taking responsibility right now, in this administration, for getting our spending under control."

If only, Mr. Obama had heeded his own words.  Instead, he racked up trillion dollar deficits in his first three budgets.  After eight years in office, the former chief executive added a staggering $9 trillion in debt, the largest of any president in the nation's history.  So much for fiscal integrity.

Some perspective: it took almost 200 years for the United States to accumulate $1 trillion in public debt. In a single year, the Obama Administration borrowed more than that amount.  In just the last 16 years, lawmakers' unchecked spending has piled on nearly $15 trillion in debt.

The spending binge will not be curbed until Congress checks entitlement spending. Fifty-three percent of the federal budget is consumed by Social Security and health care entitlements, including Medicare, Medicaid and Obamacare.  Elected officials refuse to deal with these hot potato issues.

By postponing the inevitable, Congress and the president are endangering the future financial solvency of the United States.  If Washington waits too much longer to address the debt, Draconian taxes and ruthless benefit reductions will be required to restore financial order.

America cannot afford to avoid the issue because the day of reckoning is on the horizon.  When it arrives, the younger generation will be punished because most of the burden will fall on their shoulders.  Is that the future Americans want to bequeath to their grandchildren?