In February 2019 the total US debt crossed $22 trillion dollars. The annual deficit is now over $1 trillion dollars. This means that each and every American (regardless of your age) owes about $70,000 to the creditors who have loaned this country money. The amount that you owe is also increasing rapidly due to interest compounding as well as new debt being added to the pile.
Note that the $70,000 dollar does not even include any debt that you may owe from your local city, county, state, or other municipal government. As an example, I recently read that the average debt for each resident in NYC is over $81,000…and that is just the city portion.
So what this means for someone who lives in NYC is they are at least $160,000 in debt to the government. This is made up of roughly $70,000 for the federal deficit, $14,000 to the state, and $81,000 to the city. That $160,000 is just what people owe in government debt…not including any credit cards, car loans, mortgages, or other bills.
In addition, the $70,000 amount is for each and every American, regardless of their age. That means a new born baby owes 70K as soon as they take their first breath. If you look at working age Americans who pay taxes, they owe 180K in federal debt (not counting state, city, local, etc.). It is quite insane.
Think about this too. With the federal government debt at over 22 trillion dollars, there is interest due each and every year to the bondholders. The federal government is paying almost 400 billion dollars for interest each and every year to service that debt. And this is with super low interest rates. If rates rise, the annual interest cost will only go up.
Just imagine what that 400 billion that in effect being wasted on interest could be used for if the government was not so far in debt? the money could pay for health care, the military, homeland security, day care, infrastructure, and countless other needs of this country.
The political season is unfortunately starting to heat up…yes 18 months to the next election! Ugghh….seems the season gets longer each and every cycle. There is more talk of giving “free stuff” to everyone. Free tuition, free daycare, free income whether some works or not (yes Democrats have proposed that!), more money in social security, etc. As those discussions come up more and more about giving free stuff, just remember that someone needs to tell you how they will pay for it.
Increase taxes on successful Americans even higher than they are? Note the top 1% already pay about 35% of all US taxes. I for one pay almost 40% of my gross towards taxes. Maybe make the tax code more fair for those companies and CEO who skirt the rules? As we said, Amazon has been paying zero taxes years! Or make everyone contribute some to taxes, as about 44% of working age Americans pay zero in government taxes as deductions and credits are targeted to helping low to moderate income families, so they pay zero.
I for one am not smart enough to know the answer, and no one has the answer or it would have been resolved a long time ago. However, be sure to ask those who make promises of all this free stuff how they will pay for it. As each and every working age reader of this blog is already hundreds of thousands of dollars in debt to the federal government.