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Debt will be the Death of the American Empire

Friday, November 25, 2005

Debt. There is probably nothing else that will destroy a nation faster than rampant debt. But, what is debt, you ask? To put it simply, it is spending today what you promise to pay back tomorrow. It's leveraging your future income against your present outgo. It's the exact opposite of having a savings account. At this time in American history, we have negative savings. According to a report on Personal Income and Outlays at the Bureau of Economic Analysis: "Personal saving -- DPI less personal outlays -- was a negative $32.0 billion in September, compared with a negative $158.0 billion in August." Americans can now boast to their grandchildren that we thought it wise and prudent to carry more debt, as a whole, than to have in our savings accounts. But, we're not the only ones on a spending spree. Rep. Ron Paul of Texas, stated in his article at LewRockwell.com: "The budget bill fails to address the root of the spending problem -- this belief that Congress continually must create new federal programs and agencies. However, with the federal government's unfunded liabilities -- Social Security, Medicare, and Medicaid -- projected to reach as much as $50 trillion by the end of this year, Congress no longer can avoid serious efforts to rein in spending."
Rep. Ron Paul casts a light on the question that few dare to ask. Namely, how are American Taxpayers ever going to be able to repay the trillions of dollars that were borrowed against them? It boggles the mind to try and imagine how much money we're responsible for repaying. According to a statement made by The United States Treasury Bureau of Engraving and Printing, if you had 10 billion $1 notes and spent one every second of every day, it would require 317 years for you to go broke. Conversely, if your government spent $10 billion, it would take you 317 years to pay it back if you could earn $1 per second, or $3,600.00 per hour. That, of course, doesn't leave you any money to purchase food, clothing, electricity, housing, etc. The good news is that you're not alone in repaying all that money. Right now, there are about 132 million working Americans to help you pay it back (see here on page 5 of the report). Take the $10 billion in the above example and divide it up amongst the 132 million working Americans and each is to repay $75.76. But, Mr. Paul is throwing around a figure of $50 trillion. That's going to be a little harder to repay because it works out to about $378,787.88 per person. Just to make this an even more ominous number to deal with, the Social Security website reports the new National Average Wage Index is $35,648.55 per year (or $17.82 per hour). So, with our "real-life" numbers, we can see that we will each pay off our personal liabilities in about 10.6 years. I don't know about you, but I'm going to be pretty hungry if I have to wait over 10 years before I can afford to feed myself!
Will we ever be able to pay off the money that Congress has signed our names to? Probably never. The interest alone on our national debt of over $8 trillion will eat us alive. So, what's the point, you ask? The point being made here is that we have got to stop our elected government officials from borrowing us into eternal serfdom. The above examples illustrates exactly why our founding fathers tried to guard against indiscriminate spending. They knew it would not take long for the people to spend themselves, directly or indirectly, into oblivion. After the Roman Empire fell, historians said that it was partially to be blamed on her rampant debt. The historians will say the same of our fall, too. Except this time, they will say that we didn't have the sense to learn from the lessons of history.

1 Comments:

Anonymous Rebellion Coffee Co. said...

Don,

Thanks for that. It's too bad there aren't more like Ron Paul!

Glad to have come across you site, we've added your link to our Libertarian News blog.

Keep up the good work.

Sincerely,

Rebellion Coffee

3:37 PM  

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