Debt & Deficit

Congress is authorized in Article I, Section 8 “to borrow money on the credit of the United States.” One definition of “credit” is “confidence in a purchaser’s ability and intention to pay, displayed by entrusting him with goods or services without immediate payment.”

In other words, Congress is authorized to borrow money to pay for government “services” on credit, on the confidence that the United States (i.e., “We the People Taxpayers”) will repay the debt.

This National Debt is the amount owed by the government. The federal budget deficit calculates on an annual basis how much government spending exceeds income (from our taxes).

At the beginning of 1791, the National Debt was $75 million. According to treasurydirect.gov, the national debt as of June 4, 2009 was over $11 trillion. That’s 11 with twelve zeros after it. It’s such an enormous number that our brains have trouble wrapping around the concept.

What would happen if each of us kept spending more than we earned each month by racking up credit card debt? As the debt grew, so would the interest. What if each of us owed “just” one million dollars? How many of us could ever repay such a debt? One trillion equals one million million!

The Wall Street Journal’s June 4, 2009 issue quotes the White House as saying the 2009 federal budget deficit is estimated to exceed $1.8 trillion (compared with $1.1 billion in 1970). Whatever happened to the concept of balancing the budget?

The National Debt Clock states that, as of today, each of the nation’s 306,327,592 citizens has as their share of the National Debt: $37,220.04. Congratulations! You’ve just been sold into slavery!

“The budget should be balanced, the Treasury should be refilled, public debt should be reduced, the arrogance of officialdom should be tempered and controlled, and the assistance to foreign lands should be curtailed lest Rome become bankrupt. People must again learn to work, instead of living on public assistance.” --Marcus Tullius Cicero