As of February 20th, the total public debt is $10,838,758,414,164.46. At the time of the writing of this article, there are 305,885,938 citizens in the United States (U.S.)—and that number grows constantly. This leaves the amount of per person debt at $35, 433.99. And what are elected officials doing about it? Spending—passing a $787 billion “stimulus package.” Now President Obama is talking about cutting the annual budget deficit in half by 2013. What must be remembered in any conversation about finance, however, is that the U.S. doesn’t just have its current and past expenses and liabilities to worry about; it also has the future.
A generation of baby boomers is swiftly approaching retirement. They will expect Social Security and Medicare as the generation before them did. The bill will be left for the next generation. Diane Lim Rogers, Chief Economist at the Concord Coalition, said at the Heritage Foundation on February 18th that she would often have people ask her “why do deficits really matter?” Her response is that “it’s borrowed money and we actually have to pay it back.” She compares Social Security and other deficit spending to “racking up a credit card bill and leaving it to your kids to pay” back—only there is no such thing as bankruptcy, and the kids keep spending more and more on top of what is already owed.
Stuart Butler, the Vice President of Domestic and Economic Policy Studies at the Heritage Foundation, asked, “Is it fair that the baby boomer generation…can get and be promised subsidized benefits in the future—which we don’t necessarily need—when the result is huge impacts financially on future generations? That’s what we are really discussing and should discuss.” He argues that to correct any problems, the U.S. has to “make serious, long-term decisions.”
Butler does give ideas for how the U.S. can “move forward”. The first is to “foster discussion” about this very topic in many different forums across the country. The second is to make “a budget process” that considers long-term effects and forces the discussion to look at all of the issues that are involved. The third is to “renegotiate on a more sound, fair, and moral basis the social contract between the generations.”
Heather Latham is an intern at the American Journalism Center, a training program run by Accuracy in Media and Accuracy in Academia.
