WASHINGTON July 16, 2011 – The debt ceiling dance has about played out in Washington, DC this week leaving regular Americans once again confounded. The double-talk, euphemisms and gobbledygook all confuse and wear people down to a point of just giving up on following the issue.
But, we must stay focused on the real point and demand a return to fiscal sanity in the country.
Let’s break it down into simple factual points.
- The U.S. National Debt clock says the debt is $14.5 trillion and counting.
- Debt means borrowing against the future. Repayment to China or whoever we’ve borrowed the money from requires return of the original fronted money plus interest.
- The current credit line established by Congress for the U.S. government is $14.3 trillion (funny math keeps us spending even though we’ve already exceeded that number).
- Federal tax revenue annually is about $2.2 to $2.8 trillion. That’s basically what we bring in to pay the bills including interest on the debt.
- All week Mr. Obama and leaders from both parties engaged in tense negotiations in a little room within the White House over raising the debt ceiling limit. Republicans, who hold a majority in the House of Representatives, have refused to sign-off on a debt ceiling increase without plans to cut spending and promises to not raise any form of taxes.
- All agree the debt ceiling must be raised or the U.S. credit rating will be downgraded resulting in higher interest payments on the $14.5 trillion and a downward spiral in the stock market again.
- According to transcripts reported by Fox News, the talks broke off when Democrats called for $1.5 trillion in spending reductions while Republicans insisted on $2.4 trillion [over a ten-year period]. The report went on: Democrats say their debt reduction would be higher but Republicans are holding up a “grand bargain” that would call for $4 trillion in debt reductions because they refuse to raise $1 trillion in taxes on upper income Americans.”
We owe $14.5 trillion. We bring in $2.8 trillion. No one is demanding the debt ceiling be capped. They are arguing over cutting $1.5 to $4 trillion over ten years. The detailed math on this is irrelevant. It does not take a genius to see the error in this picture.
Ben Franklin said: “Think what you do when you run in debt; you give to another power over your liberty.”
Debt for a nation is something only to be incurred in a crisis and then quickly repaid. Our debt is now the crisis. We are allowing the government to finance our prosperity with borrowed money.
From adoption of the Constitution through every generation until the present one, paying off any national debt was of supreme priority. George Washington told Congress, No pecuniary consideration is more urgent than the regular redemption and discharge of the public debt; on none can delay be more injurious, or an economy of time more valuable.
In 1960 the national budget was less than $100 billion. That’s less than the interest payment on national debt today.
There is a way back to economic prosperity. The formula is simple and it was laid out for us by the founders and contained in the Declaration of Independence and Constitution. Study these documents and the words of those who crafted them.
Government is not meant to provide for all our needs. It is designed to protect us from wrong doers, protect property and protect national interests. It is up to us as individuals, families, communities and businesses to generate the wealth that covers all other needs.
In one of two press conferences this week alone, President Obama said;
“A family, if they get overextended and their credit card is too high, they don’t just stop paying their bills. What they do is they say, ‘How do we start cutting our monthly costs?
We keep on making payments, but we start cutting out the things that aren’t necessary, and we do it in a way that maintains our credit rating.”
If only he meant that statement, there would be no need for further negotiations.
Carla Garrison follows current events with one eye on history and the other on the future. Her goal is to encourage people to know the truth and use it as a call to personal action
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