As sure as the sun will rise in the morning, the debt ceiling will rise in the United States. Increasing the debt ceiling limit is not a Republican thing or a Democrat thing – it is a United States thing. Congress has enacted 74 separate measures that have altered the limit on the federal debt since March of 1962. The statutory limit on federal debt began with the Second Liberty Bond Act of 1917, which helped finance the United States entry into World War I. In case you have wondered, the United States has had a national debt since its inception. In 1791, the U. S. debt was $75,463,477 dollars. The first billion dollar debt was established in 1863 when the debt rose to $1,119,772,139, obviously a result of the Civil War. Again, as a result of a war, the debt in 1918 rose to $14,592,161,414.
Congress has raised the federal debt ceiling 10 times in the past 10 years. The frequency of the increases is a direct result of the increase in federal spending. As a country, we have developed federal budgets with built in deficits. Since fiscal year 2001, the debt held by the public grew continually due to persistent and substantial budget deficits. President Obama submitted his proposed 2012 budget with a $1.1 trillion dollar deficit. I remember my Economic 101 class and if I recall correctly, the outlay of funds in this 2012 budget is $1.1 trillion dollars more than the incoming funds. I also think that we, as Americans, have to listen carefully when the politicians tell us that “they are reducing the deficit.” Yes, they are but I think they mean the proposed deficit.
Over the past year alone, the amount the U.S. government owes its lenders has grown to more than half the country’s entire economic output or gross domestic product. Sad to say, but the Public Debt forecast is predicted to hit $16.5 trillion dollars in the 1st Quarter of 2012 with a $20 trillion dollar debt by the year 2020! As I have previously pointed out, the interest on the Public Debt is growing and this is not something that our grandchildren alone will pay for. We are going to pay for it now and for every year in the foreseeable future until out National Debt is brought under control. It is estimated that the interest alone for the fiscal budget year 2011 will be $385,871,949,498.62. You know what we get for this interest payment – nothing at all!
Mr. Obama talks about “kicking the can down the road” but I am afraid that the can is growing and we may not be able to kick it very far. Economic forecasters say future generations of Americans could have a substantially lower standard of living than their predecessors for the first time in the country’s history if the debt is not brought under control. The debt ceiling in the United States currently sits at $14.294 trillion. A default by the United States on its debt scares me but maybe now is the time to take a stand.