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The history of public debt is the very history of national power: how it has been won and how it has been lost. … But never, outside periods of total war, has the debt of the world’s most powerful states grown so immense. Never has it so heavily threatened their political systems and standards of living. Public debt cannot keep growing without unleashing terrible catastrophes.
The Gainesville, Florida Tea Party put the national deficit and debt in perspective when they compared the income and expenses to that of a family. The following is their assessment as reported by Fox News:
,,, a household with an average family income of $21,700. But that "family" spent nearly twice that -- $38,200 -- and has an existing credit card balance of a whopping $142,710.
Sure, these are inexact findings. However, they do expose the gross irresponsibility of many Congresses and Presidents. Let’s look at Presidents' and Congressional reactions to those of an ordinary family.
Denial is a natural response. However, for a family, the credit card company is going to cancel their account. Unfortunately, denial is rampant and ongoing in government. Presidents and Members of Congresses have long denied that debt was a problem.
Today, the President and Congress are borrowing 40 cent on every dollar spent. Unlike the family, government does not have a vigilant credit card company cancelling governmen's access to credit.
Hence, the government issues more treasury bonds and the world continues to purchase them. Incredibly, the world’s investors have more confidence in the United States than most other countries. If we stay in denial and continue expanding the debt, at some point – nobody knows when, the world will stop buying our debt and a catastrophic economic collapse will occur – nationally and throughout the world.
Thus, a family without credit and expenditure would have creditors harassing them for payments and, most likely, fear the bank would foreclose on their properties. The family would be distraught, fearful and miserable.
Is Congress fearful and miserable? No, most Members are gleefully continuing to spend more money.
Is President Obama distraught? Probably, but not because he is spending America into bankruptcy. He wants to spend more. He is distraught because Americans are indicating they will not vote for him. Why are Americans leaving Obama? Could it be that Americans are fearful of government’s gigantic debt?
In this scenario, the stressed family must consider bankruptcy. Generally, bankruptcy allows the family relief from their crushing debt. The bankruptcy court requires the family to swear under oath that they had $142,710 in debt and they would make a list all their assets. According to the bankruptcy code, the family is allowed to keep their essential assets and cash-out the remaining assets to distribute the money to creditors.
There is no bankruptcy court for the federal government. When governments fail to honor their debt, they default. Presently, there is an acute concern that Greece may be forced into default. European banks are over-extended in Greek bonds and the world’s investors are unnerved. As a result, the Euro is devalued.
In the past few hundred years, great empires have defaulted, which resulted in wars, civil wars, and economic chaos. For the United States to default would be a total disaster – nationally and worldwide.
At the moment, the investors of the world are still purchasing United States treasury bonds. However, what happens if the world no longer trusts the United States and refuses to buy our bonds? Then, the United States will be face default and all the catastrophes associated with it. [Read: Paul Ryan: Country can't sustain these high levels of debt]
Reducing our debt is absolutely necessary. Our economy, democracy and the exceptional progress in commerce, science and art are endangered. America’s political elites have willfully caused the debt and are now treacherously ignoring it.
Do you remember how bankruptcy allowed the debtor-family to clear its debt by listing their debts and assets? The United States government must do the same immediately. We must stop the denial. We must stop the deliberate deceptions about the debt and be honest with the American people. Let's list our debts. This is not trivial. The government obfuscates and misleads Americans about the true debt. [Read: When Pretending Fails to Hide Bankruptcy]
Also, the United States government must list their assets. Just like a family going through bankruptcy, nonessential government assets should be sold and the money should be used to reduce our dangerous debt. America has millions of acres of land and much like a family going through bankruptcy, the United States government must sell most their assets. No, Yellowstone Park doesn't need to go on the chopping block, but a large portion of the Bureau of Land Management and the Forest Service lands could be sold to help offset our debt.
Time is of the essence. The President and Members of Congress must become honest and responsible stewards of America’s finances. They must list the debts and assets, and reduce the debt immediately.