$15 trillion debt, and Congress on Prozac – Jackson Closed the Central Bank.

$15 trillion debt, and Congress on Prozac


Bill Vincent, Fort Worth Personal Finance Examiner
November 16, 2011

One of the incredible benefits of being in Congress MUST be a virtually unlimited Prozac supply. There can’t be any other explanation to the inaction on public debt.
Perhaps Congress views the public debt like many people view birthdays. A birthday is a milestone, certainly. But just another day. And so, it seems, is the attitude of the United States Congress, to what should be the earth-shattering news that the United States’ Government’s accumulated debt, also known as the “Public Debt”, just surpassed $15 trillion. Yes, a huge milestone. But, for Congress, just another number.
As of this writing, the public debt stands at $15,037,781,593,007.03. And counting! That’s $15 BILLION, one thousand times! The definite benefits of proper use of Prozac aside, perhaps members of Congress are on enough psychotropic medications to dull the sense of the sheer economic impact that $15 trillion in debt has on all Americans. Either that, or their continued spending binge is a lethal and astounding combination of ineptitude, mismanagement, and almost psychotic lack of empathy for what this spending is doing to the next 3-4 generations of United States’ citizens.

Well, before you read the rest of this, make sure to remove yourself from any access to sharp objects. Or, perhaps, take that prescribed dosage of Prozac, to enable you to handle learning just what public debt is doing to you, without experiencing uncontrollable outrage.
What exactly IS public debt? Public debt is the accumulated debt the United States Government owes for its operations. Each year the government spends more than its revenues, the public debt increases. We call this “deficit spending”. When the government balances the budget, public debt stays the same.
When the government takes in more revenue than its expenses, public debt decreases.
The U.S. government has participated in deficit spending many years in its history. We started with $75 million debt in the 1780s, in order to finance the Revolutionary War. And so began public debt.
Except for 1835 …
In 1835, the United States actually completely paid off its public debt. It’s the only year in our history in which we didn’t have public debt. Andrew Jackson was running for president, on the platform of abolishing the central bank of the time, called the
Second Bank of the United States. The head of the central bank, a man named Nicholas Biddle, objected to Jackson’s platform, so much so, that he decided to shrink the money supply of the entire United States, causing a Recession. He figured to publicly force Jackson to change the platform. Jackson did not.
And the charter for the Second Bank of the United States was allowed to expire. With no central bank, the United States completely paid off its public debt. Since then, public debt has skyrocketed, in recent years exponentially.
Why should anyone be alarmed now? Because of the rate of increase of the public debt. Here it is in each of the last few years, projected into 2012:
2008: $10.0 trillion
2009: $11.9 trillion
2010: $13.5 trillion
2011: $15.5 trillion
2012: $16.7 trillion
So, will this cost me anything? Yes. Absolutely.
Public debt is Congress’ credit card. And since the 16th Amendment authorizes Congress to tax citizens directly, Congress expects you to pay for it. And remember that Congress ALSO has the authority to raise its “credit card” limit. That limit is called the “debt ceiling”.
How much is our portion? Well, here is the math: $15 trillion of debt, with 300 million citizens to pay for it.
That works out to be $50,000 per person. A family of 4 currently owes $200,000. Since no family of 4 wants to pay the United States $200,000 in addition to regular taxes, this debt will more than likely be passed down to 1-3 generations.
Exactly who owns the public debt? China owns $1.4 trillion, Japan owns $1 trillion, the U.K. owns about $1 trillion. The rest is made up of other countries and individuals. Basically, anyone who buys government bonds owns a portion of the public debt.
So yes, foreign countries have ownership of our public debt. That percentage of foreign country ownership has risen in the last few years.
“But this isn’t my fault,” you’re probably saying. “I didn’t make these purchases! And I certainly didn’t expect to owe a foreign country anything for American government functions!” And you would be correct.
What are your options? The 2012 election is a chance to make a statement to D.C. politicians that the practice is to stop.
Or, you can reach for that Prozac. Like Congress must be doing. Business as usual.

November 30, 2011 · Jennifer · No Comments
Tags: , ,  · Posted in: A Night of Clarity JULY 22-23, Andrew Jackson

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