By John Weaver
Growing up, my parents were adamant about living with limited debt. More to the point, they stressed upon me the importance of paying off the credit card each month (I still do today), implored upon me to explore affordable education opportunities (I attended a state university and graduated with a BA degree sans college loans; I have several more degrees where my employer picked up the tab and graduated debt free), and limit debt accumulation where possible to items that appreciate in value (like home ownership).
Our government should lead by example and do the same. It should learn to live within its means as a matter of national security. There are no free lunches, and the ones who will be saddled with this problem are the current generation just entering the workforce.
The debt problem is especially true when we see exigencies arise like we are experiencing with the current COVID-19 pandemic and the state of our country amidst the present recession. Debt hurts our chances for recovery
The debt has been steadily rising in recent years and is putting our nation in a pernicious position. Currently, we sit in the red at just over $25 trillion in debt; it grows by over $1 million every 30 seconds.
In 2011, Congress and former President Barack Obama saw the importance of this and passed the Budget Control Act of that year. In this law, the federal government was charged with balancing the budget to help ensure that expenditures (government spending) did not exceed revenues (taxes) to help do away with deficit spending while paying down on the national debt.
For a few years, things seemed to be improving though some perilous provisions were implemented vis-à-vis sequestration designed intentionally to ensure that Congress made the tough decisions or live with the consequences of cuts to such things as defense spending.
This began in earnest in 2013, but since 2016, the federal government has gone back to spending more than it takes in.
Why is limiting our debt important? Roughly a third of our debt is owned by foreign countries. More to the point, over $1 trillion in U.S. treasuries is owned by China.
The strength of our economy and the U.S. dollar is inextricably linked to the confidence that this country will be able to pay what it owes (not just on the domestic side, but to foreign owners of our debt as well). This is important under normal conditions; it is extremely important in periods of emergency because after all, who wants to lend to someone who cannot pay back what they owe.
The problem has been enhanced by the COVID-19 pandemic. Congress enacted emergency spending of nearly $2 trillion in six weeks. This equates to increasing our debt (yes debt) by nearly 9 percent in less than two months. This compounded with high unemployment, economic stagnation, and prolonged uncertainty about just when life will return to normal exacerbates the situation.
The United States must get its house in order. If it wants to continue to be seen as the world’s sole superpower and is interested in being viewed as a global leader for the foreseeable future, it must act responsibly. To do so, it could look at a two-phased approach.
The first will deal with getting the COVID-19 crisis under control, creating and implementing a successful vaccine, then get the nation back to work.
Once this is achieved, the adults in the room (namely Congress and the President) must take a second look at something akin to the Budget Control Act of 2011 to bring under control deficit spending and by extension, our debt. After all, it is not if the United States will be confronted with a future exigency, but when. We must have the capital to help absorb the shock in the future.
This dangerous game of musical chairs unfolding before us is one that will be shouldered by younger Americans; this is just not fair.
Let us hope that our elected officials can rise to finally see the elephant in the room and become the adults in that room with the prescience to take note to finally do something about this or risk the United States becoming a waning power akin to the Roman Empire. The U.S. debt is a pressing national security concern; we must confront it head-on.
John Weaver is an associate professor of Intelligence Analysis at York College of Pennsylvania, in York, Pa. His work appears occasionally on the Capital-Star’s Commentary Page.