Many Americans, including, unfortunately, many of our elected officials, and politicians, seem to feel, it’s no big deal, if the United States, runs a deficit (even a large one)! However, although the Federal Government deems it appropriate, and Congress approves, they can print additional paper money. Just because they can, and it’s permitted, by law, doesn’t mean, it makes sense, to do so! When the government runs at a deficit, the U.S. Treasury authorizes the printing of additional currency, to cover this shortfall. This means, the nation accumulates additional debt, which, at some point, must be repaid. With that in mind, this article will attempt to, briefly, consider, examine, review, and discuss, 5 reasons, this matters, and has signification ramifications.
1. Comes back to haunt you!: The lack of discipline, or the short – term, search for irresponsible planning, etc, often will come back to haunt the nation! Since President Trump, is presently, in several international trade disputes, including, with Mexico, Canada, European Union (EU), and China, etc, doesn’t it make sense, continuous reliance on additional debt, might be unsustainable, and put our nation, in a potential bind? For example, China is, and has been, for some time, the single largest purchaser of United States debt vehicles (Treasury Bills, Notes, Bonds, etc), and, recently, has started to sell – down their inventory of this debt, and is purchasing far less! With the tariffs, etc, our President has imposed already, and is threatening to expand, couldn’t China, use this, against us?
2. Burden on future generations: Whether you like it, or not, eventually, this debt, will put a burden, on future generations! A larger, and larger, percentage of every year’s budget, goes towards paying down the debt, and, is already representing the single – biggest component of the nation’s budget!
3. Economic instability: How essential might it be, to focus on the longer – term, sustainable, economic stability, of our nation?
4. False sense of security: President Trump, and his supporters and allies, proudly point to the robust economy, our nation is experiencing. Statistically, we are experiencing, record – low unemployment levels, and an amazingly, improved Gross Domestic Product, or GDP. However, a significant reason/ cause for the success of the GDP, is, because of the impact of the deficit, itself. When a government has a deficit exceeding a trillion dollars, the immediate impact is, like adding that amount, into the U.S. economy. Combining that, with the beneficial effects of the 2017 tax reform, larger corporations, especially, significantly benefited, and, a portion of the job growth, occurred because of the present false sense of security! Is this, sustainable, or will we witness, negative ramifications, sometime, in the not, too distant future?
5. Wasted time and energy: So much time has to be spent, in Congress, debating expenditures, the budget, and considering the raising of the federal debt ceiling (based on this constant deficit), we are witnessing significant, wasted time and energy. Who believes, there should be priorities, which need addressing, which the current political atmosphere are making, even more challenging, which are punted, down – the – road?
Wake up, America, and demand, your elected officials, begin behaving responsibly, and truly, serving and representing, the best interests of most Americans. When a questionable tax reform legislation, becomes, largely, the cause of significant deficits, isn’t it, about time, politicians became statesmen, and did, the right thing, for a quality, sustainable future?