The raging debate about the debt ceiling has past. For a while. It will come up again. There will be more debate and more posturing and it will be raised. Again. There is really no choice for these politicians. It is the natural order of the two party system in America.
The group in the majority will promote the belief that of course the debt ceiling must be raised. They will rant about the consequences of an American default. They will promise a serious debate this time to balance the budget. The next budget. Not the current budget. They will pontificate how the goal is to not burden the next generation with the debt of this generation.
The minority will counter with the oft used claim of failure of leadership. They will cite the majority as either unable to avoid spending more than it takes in via taxes or "mean-spirited" in their budget choices. They will suggest that the majority is shirking their responsibilities to the nation.
It doesn't really matter which party is in the majority. They use similar rhetoric. It's all about deflecting responsibility and confusing voters. Confused voters will usually default to the incumbent. It's that "lesser of two evils" mentality.
The reality is that the idea of a debt ceiling is ludicrous. Under this two party system it will always go up. Basic mathematics dictates that it must go up based on the actions of those in policy (read spending) positions. The sheer size of this national debt means the interest due alone will force a continual rise in this "debt ceiling."
At least it will have to go up until we are ready to finally face the pain and right the ship. At this point, no one in Washington wants that to happen during his or her time in office.
The Clintons are quick to remind anyone who will listen that during part of those eight years of Bill Clinton's presidency, there were actually budget surpluses. What they do not mention is that every year of his presidency, the national debt went up. Every single year.
In his first year the national debt was about $4.5 trillion dollars. By the end of his second term it was over $5,6 trillion. During the younger Bush era it went from $5.9 trillion to over $10 trillion in those eight years.
For the first four years of the current administration the total moved to over $16 trillion. It costs more each year to service the mounting numbers. It is now approaching $19 trillion. That breaks down to about $62,000 per citizen, including children, in America.
Depending on when you read this page, the clock just below may be outdated as it relentlessly climbs and climbs.
And this doesn't even take into account the "entitlements" owed that aren't factored in to the numbers. It is estimated that state and municipal debt is now over 100% of annual revenue. That number doesn't take into account "unfunded obligations" such as pensions. Adding in those numbers pushes the gap to over 250% of annual revenue.
Basic math tells us that costs must go down dramatically. That means things have to change. That change would require a new wave of decision making. You saw again during this debt ceiling debate that it is all about partisan motives and backroom dealing.
Our page about fiat currency included a great video that explained the way the money system has been corrupted by a willing government and a bank owned private entity given control of the currency supply.
History tells us this always ends badly. The books within the financial literacy curriculum we present are there to help you prepare and to protect your family. The information is meant to get you thinking about what is right and how to demand that right path from elected officials. In the private sector they would have been fired long ago.
Here is a link to some information about the debt ceiling challenge. Peter Schiff, co-author of "How An Economy Grows And Why It Crashes", offers a great explanation of the directions taken from both sides of the political aisle in Washington D.C. It was written over a year ago, but is still very accurate and on point.
His writing style used in that edition mentioned in the last paragraph and also included in our list of classic books makes the subject matter very easy to understand.
The biggest elephant in the room is still the stranglehold of the federal reserve system and the corrupt big banks that profit off this ever increasing debt.
Fixing that century old systematic robbery machine born at Jekyll Island will take a groundswell of public outrage and some leaders who are looking to serve and lead. The united voice will come with more knowledge of how things really work. The courageous leaders will come from the same place.
Be sure to read "The Creature From Jekyll Island" by G. Edward Griffin. It will probably make you mad. But that isn't always a bad thing. Such emotion often leads to more questions which might lead to better solutions.