In a USA Today Newspaper article by Richard Wolf (January 8, 2012), he reported that the national debt is as big as the national economy and will grow beyond the US economy. This echoes what was reported by the United States Government Accountability Office in November, 2011.
Here are some snippets from the report which is on-line (GAO-12-164):
Page 2 – “Debt held by the public represents a burden on today’s economy as borrowing from the public absorbs resources available for private investment and put upward pressure on interest rates. In addition, interest on debt held by the public is paid in cash and represents a burden on current taxpayers.”
Page 3 –“…the increases to total federal debt over the past 4 fiscal years represents the largest dollar increases over a 4-year period in history.”
Page 6 – “…GAO’s recent long-range federal simulations continue to show an unsustainable fiscal path driven by structural imbalance between revenues and spending for entitlement programs.”
So there is a new record for spending without the money (revenue) to sustain it. It is like the people who purchase a multitude of items on credit but cannot pay for what they buy. Ultimately, it means going bankrupt. The difference is that the government keeps printing money which means inflation. Inflation is a hidden tax because wages lag behind rising prices. Inflation also hurts those, such as retirees, who are on fixed incomes.