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Thursday, February 24, 2011

American Challenges

With all the people marching in the streets around the world, trying to get their government leaders' attention, I'm wondering if Americans ought to join in. After all, there are some things we'd like to call our government's leaders' attention to. And for the life of me, I cannot understand how the politicians that we elect in Washington, DC can wander around acting as if life is normal when we have massive threats to the sovereignty of our country looming over our heads. Call me a pessimist, but some of these things just have to be addressed. Now.

Let's start with the national debt. As of this week, it stands at $14,123,589,307,190.50. If we divide that by the approximately 300 million people that comprise the United States of America, it equates to about $47,078.63 for every man, woman and child alive today. How many people live in your household? Multiply that times this amount and you can see what your personal share of the burden is.

Of course it is the largest national debt number ever known to any state in the history of the world. But if that's not an attention getter, there are more practical aspects to this dilemma. For example, the current interest expense on this national debt is equal to about 10% of all government spending. Said differently, 10% of all the money the government spends is being used to pay interest on the national debt.

Now keep in mind that what our government spends is not equal to what you pay in taxes. So this 10% number? It's considerably more than the amount you pay in taxes. In fact, the government will spend, just this year alone, about $1.5 trillion more than it will receive in tax revenues. So just like the cartoon, we really are borrowing from our MasterCard to make the payments on our Visa card!

The U.S. faces two huge problems right now that really are linked. Our unemployment rate is hovering at about 9.4%. But once you add in those who want full time work but can find only part-time jobs, it is almost twice that (or about 18%). Job creation is not even keeping pace with the rise in population. And the budget deficit is running at almost 10% of gross domestic product (GDP). What that means is that the amount of money our government needs to borrow this year to keep the lights on is about 10% of all the money that will be made in the whole country this year.

But the first couple years of Obama's presidency, he and his administration largely focused on health care reform. Is that really the most seriously pressing issue? I don't think so. Now Obama referred to our currently dilemma (i.e., lack of innovation, lack of progress, etc.) as a "Sputnik moment." He was recalling the time back in 1957 when the U.S. realized that Russia had just out done us on the space program. So we surged forward with major investments in infrastructure, education, space exploration, etc.

And Obama wants to call our nation to do the same now ... surge forward with massive investments to ensure that America remains the leading super power globally. The only problem is that back in 1957, the U.S. government had piles of cash to spend on catching up. Now it has none. In fact, we owe everybody and can't even maintain our mediocrity without borrowing heavily from both our friends and our enemies in the world.

Perhaps the thing that disappoints me most about how our government leaders are failing us is that they are allowing Americans to continue living in denial. Just once I'd like to see a politician go on national TV and tell us that we have to pay more taxes. A lot more. These freedoms that we all hold so dear? This country that we're all convinced is the greatest on earth? It turns out they are considerably more expensive than anyone thought.

I love the United States. Perhaps it is the greatest country on earth. But frankly I can't enjoy something nearly so much if I don't own it. And Americans are fast losing our ownership of these freedoms and riches that we hold so dear. Unless we pony up and start paying a lot more taxes than we're paying now, we could lose everything that we hold so dear. It'll be foreclosed on by our creditors. Talk about a foreclosure crisis!

The first step is for Americans to get educated. It's clear (at least to me) that our government and its leaders aren't willing to tell us the truth about the situation at hand. Fortunately Peter Peterson has plowed a bunch of his wealth into a foundation that is dedicated to educating us, equipping us and calling us to action. You can check it out and join the cause at

I urge you, if you really love this country and value our freedoms, then go get the facts. Find out how expensive this way of life really is. And let's start having a national dialogue on how we're going to pay for it.

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