I read that America has dangerous levels of federal debt but also read that it really doesn’t matter. Which is it? And what should I do about it?
America’s federal debt has recently swelled to twenty-two trillion dollars. Those are numbers that were once used only in the field of astronomy.
This is a confusing topic because it is impossible to accurately predict a tipping point for our national debt. The danger lies in our ability or inability to respond to a future crisis. It is my opinion that regardless of our government’s debt, believers should manage their finances in a way that honors the Lord: prepared for a crisis and not living dependent on the government.
Some make the argument that our debt doesn’t matter because America has an advantage over many nations. We have abundant natural resources, one political system, one monetary system, one primary language, fairly peaceful neighbors, and a population that all grant confidence for foreign investors. All true.
Our government debt is not an immediate concern for many because interest rates are low. However, if our lenders ever lose confidence in the good faith and credit of the U.S., then our debt could actually become a real threat. There are those who believe the Modern Monetary Theory in which a government in control of its currency just prints more as needed. Deficits don’t matter to MMT-ers, because the government can’t go broke. So they believe.
Despite the Naysayers, Debt is a Real Concern
For years, I have been saying that the American government, and America itself, has to change its spending and borrowing policies: the tens of trillions of dollars in unfunded entitlements and promises, the dangerous dependence on foreign capital, our pitiful level of savings, the metastasizing health-care costs, our energy gluttony. These structural deficits are unsustainable.
Martin Crutsinger, at apnews.com, wrote:
The national debt is the total of the annual budget deficits. The Congressional Budget Office projects that this year’s deficit will be $897 billion – a 15.1 percent increase over last year’s imbalance of $779 billion. In the coming years, the CBO forecasts that the deficit will keep rising, top $1 trillion annually beginning in 2022 and never drop below $1 trillion through 2029. Much of the increase will come from mounting costs to fund Social Security and Medicare as the vast generation of baby boomers continue to retire.
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SOURCE: Christian Post, Chuck Bentley