The title of this blog is fundamental to our nation’s economy. We have a $16 trillion dollar debt that is growing by thousands per second. All political solutions have been non-solutions.
Anybody who knows economic history is aware that the federal government is a poor money manager. Politicians use other people’s money for pet projects or programs that favor their political party. Entitlement programs are supposed to be self-supporting. But they have become mill stones around the neck of the American economy driving us deeper and deeper into debt.
Gordon S. Wood, Brown University professor, said it best. History “shows that the best-laid plans of people in the past often went awry and that most people struggled against forces which they never clearly understood and over which they had little control….” For example, Lyndon Johnson’s War on Poverty was to help people escape the clutches of poverty and allow them to be upper mobile. Yet after billions of dollars were spent on social welfare programs poverty rates have increased rather than decrease.
Adding to the debt situation is the Obamacare entitlement. The complexity of the law has already spawned confusion and impacted our economy because of the taxes it imposes. In 2014 there will be 28 new taxes imposed on the middle class. This will further sap the economy and cut consumer spending. In addition, the Congressional Budget Office has already reported that ObamaCare will be in the “red” by 2012 thus adding to the debt.
Ultimately, debt drags a nation down. No amount of taxes will be able to remediate the failing economy. If anything, we may be headed for another depression. Spending more by the federal government only puts the nation deeper into debt. What the average American doesn’t realize is that debt could lead to a financial disaster. It was debt that played a part in the fall of the Roman Empire, it was debt that helped caused the French Revolution and it was debt that brought about the fall of Communism.
We are borrowing huge amounts of money from foreign nations, especially China, that could be disastrous. China’s economy is slowing down and if they want their loans to the US repaid quickly, it could be the financial ruin of the United States.
Debt is a money pit!