Many times I want to write about something that requires me to use a big number. The problem is that big numbers may cause you, my reader, to lose sight of my point.
For example, what is a billion dollars? What is a trillion? Besides being numbers that require four or five commas, I am not sure if they have real contextual meaning. President Reagan once described a big number by saying that it can be represented by the number of stacked dimes needed to reach the moon. I don’t know about you, but once I get about 10 dimes stacked, they fall down. To reach the moon, you must be a skilled dime stacker. I give you this warning because I want to talk about the national debt, and I don’t want to use a big number.
First, where does the national debt come from? Well, — see I already sound like President Reagan — the federal government runs a budget deficit in a given year if it spends more than it collects in taxes in that year. To cover the deficit, the government borrows money. The national debt simply represents accumulated deficits. In any given year, the federal government issues new debt to cover new deficits and issues additional new debt to cover old debt that is coming due and current interest payments. See, we really never pay it off. It is rolled over.
How big is the national debt? This is where I might use a big number, but I won’t. Instead, I will make it personal and describe it by saying that every person in the United States owes at present, on average, $69,000 of the national debt. Also, this number grows every day.
Just think about that for a moment. Every American citizen you see today owes $69,000. Every child born today at the Southeast Georgia Health System hospital owes $69,000. On many mornings, the first person I see awake is Stacy at Starbucks, who by the way should teach customer service to the world. She owes $69,000. Each of the men who, in the morning, sit in front of Parker’s on St. Simons solving world problems owe $69,000. If you fly to Los Angeles tomorrow all the TSA officers, pilots, fellow passengers, everyone in the Atlanta airport if you change planes, everyone you fly over, and everyone in Los Angeles owes $69,000. In addition, each American citizen you did not see or even think of, owes, at present, $69,000.
Usually, debt is something that is accumulated voluntarily. We have mortgage debt because a lender loans us money because they want to help us own a house. I have credit card debt from voluntary transactions. Nationally, college students on average, upon graduation, owe nearly $38,000. (CCGA students owe considerably less.) All of this, please remember, is accumulated voluntarily.
In contrast, the $69,000 of per capita national debt is imposed upon birth or at saying the citizenship oath. You would think, if we loved ourselves, our children, and our grandchildren that we would do something about this imposed — yes, imposed — debt. Remember, the federal government does not have its own money. It has our money and is borrowing continuously from anyone — foreign or domestic — who would rather hold Treasury securities than hold dollars.
Why do our leaders in the federal government not do anything about this? Here is the sad truth. The national debt and disciplined fiscal management do not matter to a voting constituency. Apparently, budget discipline matters to no one when they enter the voting booth. Have you heard any of the Democratic presidential candidates — who all owe $69,000 by the way — talk about the $69,000? How about President Trump who, by the way, owes $69,000? Can you name the only candidate talking about this?
Politicians, wanting re-election, do things because of voting constituencies. Voting outcomes are the result of the relative power of these voting constituencies. You would think that some sort of gun control legislation might have come after the murders of 20 children between the ages of 6 and 7 at Sandy Hook Elementary. But no — this is the result of the battle between two opposing constituencies. Many people vote in elections based on a candidate’s stand on gun control. Many folks vote on candidates based on their stands on health care reform — and on and on. No one votes on a candidate’s stand on the national debt. We vote for them if they spend money on us or our favorite cause, but we really don’t care how they pay for it. They owe $69,000 too.
As long as the national debt is rolled over by periodically selling new debt, difficult questions and choices can be avoided. Maybe, someday, ‘rolling over’ will not be possible. Then all of us — more likely some future generation who will owe, by then, more than $69,000 per capita — will have to pay up. As for now, some people, and even some economists, argue that the national debt does not matter. All I know, however, is that they, too, owe $69,000.
In conclusion, it is worse than what you have just finished reading. In addition to the national debt, the federal government has made promises to us through various programs that are not currently funded. These are referred to as federal unfunded liabilities, things like Social Security, Medicare parts A,B, and D, government pensions, etc. The current total of these unfunded liabilities is — Warning! Warning! A Big Number — $122 trillion. This will grow to $157 trillion in five years. The current number ($122 trillion) divided by the estimated 2019 population of the United States is $380,382 per every person, or 5.5 times the per person measure of national debt of $69,000. So, everyone driving across the causeway today either currently owes or will owe $449,382.
And just think, we have presidential candidates promising free (read as unfunded) Medicare For All, free college, free, free, free everything. Is there no shame anymore? I hope, one day, this will matter at the voting booth.