April 25, 2019

Will We Ever Get Our National Debt Under Control?

Probably not and the chances of ever paying it off or even paying it down are slim to none. As of September 20th of this year, we owe $21,499,171,612,329. Yes, that’s $21.5 trillion dollars! At some point during the calendar year 1984, we moved from billions of dollars to trillions of dollars. The national debt at the end of 1984 was $1.575 trillion dollars.

Two things make this debt picture bleak: the United States Government operates without a balanced budget. The projected budget deficit at this point is $684 billion dollars and growing. This deficit is 21% higher than the deficit for the same period last year. The Trump administration is projecting that when the fiscal year ends September 30th, 5 days from now, the budget deficit will hit $890 billion dollars. For the fiscal year 2018, the interest on the national debt will come in at $494 billion dollars.

Folks, we are in trouble! During the George W. Bush administration (2001-2009), $5.849 trillion dollars was added to the national debt. During the follow eight years, Barack Obama (2009-2017) tacked on an additional $8.588 trillion. And although federal revenues are up during the first two years of the Trump administration, the National Debt continues to climb.

The bottom line is this: the national debt is the responsibility of both political parties. However, at this time in our history, neither party seems interested in addressing the ongoing and growing fiscal debt.

Basically, our government spending exceeds our incoming revenue. Whether one classifies the spending as discretionary or mandatory is irrelevant. The federal government does not have the revenue to pay for the appropriation bills that it authorizes in lieu of a budget. The fiscal responsibility that should exist in our government is non-existent. The Affordable Care Act, when passed, was approximately $500 billion dollars short of the funds needed to support it. The recent tax reform bill passed by Congress was $1.5 trillion dollars short and will result in a projected deficit spending situation over the next 10 years.

Somewhere along the line we will have to seriously address our national debt issue. But sadly, our government runs along party lines. Should the balance of parties be adjusted with this fall’s election, our Congress could return to a state of operational paralysis. Our entitlement programs (specifically Medicare and Social Security) are in danger of running seriously short of funds in just a few years. These programs comprise almost 68% of the government funding. No one likes to see the cost of borrowing rise but the alternative is a Zimbabwe-like situation where we just continue to print money and watch inflation skyrocket in the United States.

Despite all of this, the U.S. Senate and House seem content in passing appropriation bills hoping that somehow one or more of them will be acceptable to the other branch. Recently, the Senate passed a massive $857 billion dollar bill that would fund the government through December 7th and avoid a shutdown of government operations on September 30th. Does this bill have any connection to incoming revenue? Absolutely not! The point of the bill is to keep the government open during elections so the American voters can select representatives, Republican or Democrat, to continue this ridiculous façade for future years.

Print Friendly, PDF & Email
Written by
Donald Wittmer

DONALD WITTMER is a retired business executive who held key roles in the automotive and banking sectors. For a time, he also served as a Fiscal Agency Manager for the Detroit branch of the Federal Reserve Bank of Chicago. He received his undergraduate degree from Cincinnati's Xavier University, an M.A. in business management from Central Michigan University, and earned certification in bank operations from the School of Banking at the University of Wisconsin-Madison. A husband, father, and grandfather, he teaches part-time at the Kent Place School for Girls in Summit, New Jersey.

View all articles
Written by Donald Wittmer