An Awesome Secret About America’s National Debt
Black is better than red. You’d rather have someone owe you $100 than owe someone $100. Better to have $10,000 in the bank than to be $10,000 in the hole. Financial security brings peace—debt brings grief. That’s just common sense.
Except, apparently, when applied nationally.
America’s preposterously elephantine national debt is in the news again, for good reason. Last month, it reached an embarrassing milestone: It is now bigger than the entire economy.
Total federal debt now surpasses $15 trillion, and that doesn’t count the more than $50 trillion the government owes in unfunded retirement promises. The debt exceeds America’s gdp. And last Thursday, the Senate agreed to allow President Obama to raise the debt ceiling $1.2 trillion higher—the sixth such increase since the president took office three years ago.
Just do the math: The federal government collected $2.2 trillion last year—a huge heap of money that is nowhere near the $3.7 trillion it spent.
Imagine a household that makes $4,000 a month sitting down to make a budget, and patting itself on the back for planning to spend $6,500. We’re not talking about impulse buying. We’re talking about planning to go $2,500 deeper into debt every month—$30,000 a year.
Comparing income to spending, that reckless family would actually be doing somewhat better than America.
Every year, the federal government takes an average of about $7,000 in taxes per American—and then spends nearly $12,000 per American. That is how it goes a heart-stopping $4 billion deeper into debt every single day.
What would it take to actually pay the bills? This video offers one suggestion. To finance one year of federal spending, just take the combined global profits of every one of the Fortune 500 companies; take all the tv ad money spent on all 45 Super Bowls; take the combined salaries of all players in the nfl, mlb, nba and nhl along with all winnings from the pga tour and nascar; take every penny of household income in excess of $250,000; take all the money from every billionaire and near-billionaire; take every dime that was spent on the wars in Iraq and Afghanistan; take everything pumped into foreign aid; and then make every American man, woman and child chip in another 40 bucks. Voila!
The bad news is, that would only pay one year’s bills, and the financial wherewithal of the nation would be gutted.
I’m guessing you have enough common sense to recognize that to “budget” yourself to go $1.5 trillion deeper into debt each year simply isn’t sustainable. It is lunacy.
But here is something you may not know—something extraordinary.
Most Americans believe the Bible. A recent Gallup poll found that 65 percent of Americans believe it “answers all or most of the basic questions of life.” So there’s a good chance you are one of them.
Did you know that the Bible specifically foretold America’s national debt? In fact, it prophesied that that debt would be a curse on this country!
If you have never read the 28th chapter of Deuteronomy, you should. It is a pivotal chapter of prophecy. You don’t even have to believe that America is a descendant of the Israelite tribe of Manasseh (which we can prove to you) to appreciate the wisdom in this passage. It is simply a list of the blessings that God promises to the nation that obeys Him, and curses that He will send on the nation that disobeys Him.
Read verse 12 to see one of the blessings for obedience: “The Lord shall open unto thee his good treasure, the heaven to give the rain unto thy land in his season, and to bless all the work of thine hand: and thou shalt lend unto many nations, and thou shalt not borrow.”
That makes sense, doesn’t it? It’s a blessing to be able to lend and not have to borrow. As much a blessing as favorable weather and fruitful labor.
It so happens that for much of its history, America has been a net lender. It has been a nation of savers and producers, dominating world trade and manufacturing. It has loaned other nations far more money than it borrowed.
Now, though, look at verse 44. This is within the portion of the chapter describing the curses for disobedience. It says of foreigners (“the stranger”): “He shall lend to thee, and thou shalt not lend to him: he shall be the head, and thou shalt be the tail.”
This is brutal reality for America today. In the last few decades, debt spending and borrowing have increased dramatically, and the U.S. has become a net debtor, borrowing billions of dollars per year from the rest of the world. Nearly one third of the money the government overspends, it borrows from foreign countries. Today America is the most indebted nation on Earth.
Pundits can kid themselves with fancy formulas and say this is no big deal; some even argue America should borrow more, as Robert Morley pointed out last month.
But borrowing is a curse, and America is already starting to suffer for it. You don’t even have to believe the Bible to see it. Just open your eyes.
Take a good look at all the money being sucked out of America’s coffers by interest payments on that debt. In fiscal year 2011, the government paid $454 billion in interest. This past December alone, maintenance on the debt cost $98.6 billion.
Look at how such enormous payouts hurt the nation. Last year, America’s top military officer, Adm. Michael Mullen, called America’s national debt “the biggest threat to our national security.” Why? He was just looking at the defense budget. U.S. military policy is being dictated less and less by strategic imperatives and more and more by budget constraints.
Think about where all that money for interest payments is going. Trillions of dollars are flying out of the U.S. into other countries. Though borrowing may prosper America for a moment, it prospers the nation’s lenders in the long run—at America’s expense, more and more over time.
And think about how that foreign debt can influence policy—even change the balance of global power. America’s largest creditor is China. How much of Beijing’s growing confidence and militarism within Asia, how much of its willingness to defy the U.S. in the international arena, owes to the fact that America owes it well over a trillion dollars? The fact is, large foreign debt hangs over the value of a currency like a sword of Damocles. America lives under the growing threat of dollar or treasury dumping, something that could wipe out its economy in a flash.
Quite a curse, all that debt. Really, that’s just common sense.
Fundamentally, though, this isn’t a case of bad economics. This is a curse—a curse imposed by God for the nation’s disobedience to Him.
It’s not very fashionable to believe in curses in our modern world. But if you believe the Bible, it’s not at all difficult to see the contrast in Deuteronomy 28 between verses 12 and 44, and to recognize which of those prophecies—issued by the Almighty God—applies to America today. It’s already hurting the nation, but the situation is precarious, and it’s about to get far worse.
Of those foreign lending nations, the prophecy says, “he shall be the head, and thou shalt be the tail.” That’s where America is heading, and fast.