Personal Finances: My wife and I have amassed some decent credit card debt by spending more money than we had available, or deficit spending. Since we are blessed with a good credit rating, the banks are always willing to raise our credit limit. They are just so nice about that. Rather than take advantage of those nice folks’ offer, we are in the process of reducing that debt through a number of means. We are going to have to spend less, sell some investments, and restructure some debt, but should have it eliminated within the next three months. Although it will be hard, but we feel that there is a need to eliminate this debt.
Government Finances: The federal government (our elected officials) have amassed some outrageous national debt by spending more money than it brings in (i.e. our earned money that it takes from us in the form of taxes and fees). The United States has been blessed with good credit and has always been able to borrow more from the Chinese and others. Unlike your personal finances, the federal government can raise its own “credit card limit” and spend more money. The Obama Administration has decided to take advantage of this benefit to “spend our way out of debt.” Although there is a need to reduce this debt, Washington politicians figure that this debt will be paid BY OUR GRANDCHILDREN!
Some recent events should make you stand up and take notice:
- The national debt was nearly $10,000,000,000,ooo.oo ($10 trillion) when Obama took office. Remember that he was a Senator and never voted to cut spending except for the military.
- Hilary Clinton’s first visit to China as Secretary of State in February was more about our debt than human rights as reported in the UK’s Telegraph as, “China now owns more than $600 billion of US government debt, and will be called on to buy more as President Obama’s stimulus package inflates the budget deficit.”
- President Obama’s November bow to asian leaders may have been more indicitive of reality than a ritualistic misstep as many sense a shift in global power to China fueled by America’s growing debt. BusinessWeek reported that, ‘The Chinese government is America’s biggest foreign creditor, with $800 billion of federal U.S. debt that gives it extraordinary power in the relationship.” Please note that our debt to China increased by $200 billion between February and November.
- Congress and Obama are pressing very hard to pass health care legislation claiming that the federal government can cover 47 million new people with health insurance and still spend less money. MAGIC.
- There are projections that Democrat and White House policies will TRIPLE our national debt.
- As of this morning the national debt is estimated to be $12,098,080,615,018.47
- It is estimated that our national debt will exceed our Gross Domestic Product (“GDP”) (the value of all the goods and services produced in the United States) by 2011.
- Estimates that our national debt will grow by nearly $5 Trillion dollars in the ten years due to interest payments alone.
- Democrats in Congress are in the process of increasing the debt ceiling by $1,800,000,000,000.00.
It troubles me deeply when elected officials continually break their oath of office and plunge our nation into more debt to serve their political needs. Like our household economy, this debt has to be paid back at some point as interest continues to grow.
Using the credit card analogy again, we are raising the credit limit, spending more money, and not even making the minimum payments.