This presidential election has seen candidates sparring on many different issues, but the national debt has not been one of them.
To raise awareness about this important issue, several high-ranking government officials created a disturbing documentary, called “I.O.U.S.A.” to raise awareness.
While the national debt is not a particularly interesting topic, this movie, like “An Inconvenient Truth,” is important to watch.
It’s easy to think the national debt is irrelevant to our lives, but this movie argues otherwise. For instance, if you divide the national debt of $9 trillion equally, every American — including you — owes a $31,600 share of the national debt. If the government taxed you $31,600 to pay the debt, suddenly the problem is easier to see — $31,600 isn’t pocket change.
The situation is much worse than that, however. The federal government has large liabilities into the future in the form of Social Security, Medicare and Medicaid.
Due to the rapid aging of our population, we will have more and more retirees living off Social Security and depending on government health care.
However, the government has set aside virtually nothing to fund these programs. Once you add in all the future spending on these entitlement programs that has been promised to seniors, you get a much worse deficit figure: $53 trillion.
To give you perspective, we can take a look at the overall size of the American economy. Our economy produces roughly $13 trillion worth of products and services, this includes everything from airplanes we sell to a plumber fixing your sink.
Our debt exceeds four entire years of American economic output – this is no small problem. Your share of the true national debt including future obligations of the government is $174,342. Suddenly that college debt seems like small potatoes.
A lot of people don’t view this as a problem because they think the debt never needs to be repaid. If we can keep borrowing in perpetuity, the debt is a non-issue.
While this sounds nice, once you realize who is lending to us, this theory unravels.
As recently as during World War II, our national debt was self-funded. American citizens patriotically bought savings bonds from the government to fund the country as it went through hard times. Times have changed, though, as Americans have quit saving their money, now the average American spends more than he earns each year.
We’ve had to turn to foreigners to fill the funding gap. America now owes roughly $4 trillion to foreign governments such as China, Japan and the Middle Eastern states.
This leads to two problems. One is that the interest paid on the debt is sucked out of the country, making America as a whole poorer.
The second is far scarier; the U.S. is losing control over some of its decision-making ability.
China has lent us almost $500 billion, and if they become angry with us, they can, in what has been deemed the “nuclear option,” cut off our funding and essentially bankrupt our government. We may be forced to do their bidding to avoid defaulting on our debt.
Rich Middle Eastern countries such as Saudi Arabia also have this option at their disposal — it’s a mockery to fight the war on terror and while allowing these terror-sponsoring nations to have control over our nation’s budget.
I urge you to watch “I.O.U.S.A.” and then withhold support from candidates who ambivalently allow the debt to grow. Both Obama and McCain are proposing policies that would make the problem worse.
Americans were outraged by the debt in the 1990’s, and the public outcry forced Bill Clinton to balance the budget. Bush threw these gains away with his delusional wars and tax cuts — we need to let the new administration know that we want fiscal discipline back.
Ian Bezek is a sophomore economics major. His column appears Tuesdays in the Collegian. Letters and feedback can be sent to email@example.com.