Debt Consolidation

An America In Danger

Posted on: June 05, 2008
Written by: UWSA Staff


In June, 117,000 more Americans were thrown out of work. While we were putting the finishing touches on this book in July, eight companies announced they were shedding 23,000 jobs. Those were just the announced layoffs.

The Federal debt is now $4 trillion. That's $4,000,000,000,000. Our political leaders will add over $330 billion to that debt in 1992 alone.

We add about $1 billion in new debt every 24 hours.

Does anyone think the present recession just fell out of the sky?

People are working longer and longer hours to accomplish less and less. New families can't afford to buy their first homes. In many families, both parents must work to make ends meet. Young people coming out of high school or college can't find a job, so even more of a burden is carried by the families that raised them.

If your family is fortunate enough to have had a child or grandchild born in 1992, by the time that child enters the third grade in the year 2000 the Federal debt could be double what it is today.

Let's try to imagine that third-grade classroom just eight years from now.

Today we have a $4-trillion debt. By 2000 we could well have an $8-trillion debt. Today all the income taxes collected from the states west of the Mississippi go to pay the interest on that debt. By 2000 we will have to add to that all the income tax revenues from Ohio, Pennsylvania, Virginia, North Carolina, New York, and six other states just to pay the interest on the $8 trillion.

If you live in one of those states, take a look at the IRS payroll deduction that reduces your next week's take-home pay. Your money is going just to pay interest on this debt, which in 1993 will amount to $214 billion. During the first 152 years of our nation's existence, we spent less than $214 billion to operate the entire government of the United States!

Think of the Louisiana Purchase, the westward expansion, the Civil War, Reconstruction, the building of the railroads, the assimilation of millions of immigrants, and the industrialization of our economy. All the great achievements that built America into the world's most dynamic and powerful nation were accomplished without any substantial debt.

And let me repeat: that $214 billion we'll pay next year is interest only. Interest doesn't buy a thing. It doesn't spur new business to give people jobs. It doesn't help people out of poverty. It doesn't maintain our highways. It doesn't protect our forests and national parks. It doesn't put more police on the streets. It doesn't restore our inner cities. It doesn't defend us. It will never build a classroom or fund research to fight disease.

Total Federal debt graph, 1970-1992

Source: OMB

Click here to see the current U.S. National Debt

The debt is like a crazy aunt we keep down in the basement. All the neighbors know she's there, but nobody wants to talk about her. If we allow the debt to grow, however, we are impoverishing ourselves. An $8-trillion debt would be a disaster requiring us to overtax our people, slash services, and severely reduce pensions and Social Security.

We are a great nation. We are a people with a great heart. We want to reach out to the single mother struggling to support herself and her children. We want to help the disadvantaged, provide scholarships for deserving students, and make basic health care available to anyone who needs it. Instead, the result of the toil, sacrifice, and dedication of our working people will go into paying the interest on a government debt we shouldn't have created in the first place.

Elected officials don't like to talk about what that massive runaway debt is doing to our country. Instead they keep to the time-honored tradition that has become standard for our elections. They talk about every tiny group's special interest and do nothing about an economy in sharp decline.

This year it must be different. The movement to place my name on the ballot has accomplished a major goal. It has focused the nation's attention on the real problems facing our country. Instead of swatting flies in the kitchen and stomping on ants in the living room, this year the nation will focus on the gorilla charging up the front steps -- the debt.

We have to face up to our debt. We have to do it now. We have to do it because no nation can afford to pay $214 billion a year for nothing. We have to do it because what happens in that third grade classroom eight years from now will determine the future course of American history.


Not only have the politicians failed to reduce the deficit and the interest we pay on it, in 1992 alone we will add over $330 billion to the $4 trillion we've already piled on our children's shoulders. That doesn't include another $3 trillion in the form of money the government has already promised to spend in the future. Our leaders keep those liabilities off the books. The weight of that debt may destroy our children's futures.

Suppose the American people demanded radical action tomorrow to eliminate just this year's addition to the debt. We've seen much posturing recently about a Constitutional amendment to balance the budget. Suppose we decided to take one action this year to wipe out this year's deficit and balance the budget. Here are some radical but unrealistic choices to show just how big the deficit is:

* Shut down the Defense Department. Abolish the entire army, navy, and air force. That wouldn't be enough to erase $330 billion of new debt.

* Shut down all the public schools nationwide. That would get us $330 billion.

* Seize the profits of all the Fortune 500 companies. That doesn't get us even half of what we need.

* Confiscate the wealth of the Forbes 400, the richest people in the nation. That wouldn't do it either.

* Now for the worst option: raise everyone's taxes. How much would we have to raise income taxes on every person in the United States just to eliminate this year's deficit? We'd have to almost double them!

That's how big a $330-billion deficit is, and we haven't even begun to tackle the $4 trillion we already owe.


How did one year's deficit become so large? How did things get out of control?

In 1990, George Bush and the Democratic leadership made a deal. The President backed off of his pledge of "no new taxes" and agreed with Congress to raise taxes by $166.5 billion. We were told we would have a budget deficit of only $96 billion. That's still a lot of new debt, but it was a major step in the right direction.

So we all went along.

There were secrets in that budget agreement neither the President nor the members of Congress of both parties who approved it told us about. Specifically, there were authorizations for $304 billion in new spending$1.83 in new spending for every dollar they raised in new taxes.

Instead of the $96-billion deficit we'd been promised, Washington was "shocked" to discover a few months later that the deficit would really be $318 billion. A little while later, they raised the estimate yet again.

President Reagan had a reason for the deficit spending that occurred in his Administration. He wanted to bankrupt the Soviet Union, and he did it by accelerating the arms race. In the last several years, our debt has grown for no reason. Government spending has risen to a record 25 percent of our gross national product, and it hasn't bought us much.

The United States is the largest and most complex business enterprise in the history of mankind. Elected officials like to say that government can't be run like a business. I can see why. In business, people are held accountable. In Washington, nobody is held accountable. In business, people are judged on results. In Washington, people are measured by their ability to get reelected. With 96 percent of Congress reelected in 1990, they must be running the most successful enterprise in the world, and they reward themselves handsomely for it.

Let's bring it down to the level of a small town. Let's assume in this small town there has always been one person who has been generous and helpful and caring all his life, as our country has been. Suddenly he finds that he's bankrupt from making bad investments and running up too much debt. Can he still give to the United Way? Can he give to the Salvation Army? Can he endow the community college or donate food to the homeless shelter or help build a new house of worship? Can he help anyone anymore? No, he can't. And what's worse, he's the one who now needs help.

Will that be our country's fate? Is that what all the dreams and hopes of two centuries will come to? Is that why our mothers and fathers labored or why our soldiers died, so that the greatest country the world has ever known would come to this?


We used to be the country that did things no one else could do. We created the cotton gin, and clothed the world. We created the harvester, and fed the world. We created the electric light and turned night into day. We taught the world how to fly. We invented the telephone. After a French company tried and failed, we went and built the Panama Canal.

The integrated circuit is one of our country's great inventions -- created and first manufactured in America. Yet, 19 out of 20 integrated circuits used in the United States today come from Japan.

After World War II, Japan and Germany lay in ruins. To(lay they are economic superpowers. In 1946, Humamatsu Honda was wandering around the streets of Tokyo looking for scrap iron to make a motor scooter. Today his company's profits are over $1 billion a year. In 1951, Toyota was bankrupt. Today it is the third largest car maker in the world. Toyota City, Japan -- not Detroit, Michigan -- is the car capital of the world.

Did they discover a secret? No. There's no secret. They made the hard choices; our leaders made the easy ones. For their sizes, Germany invested over twice as much, and Japan invested over three times as much as we did throughout the 1980s to build their countries. Our political and business leaders seem to think short term. Their leaders think long-term.

Before the early 1970s, our standard of living doubled every generation and a half. Now it will take twelve generations for our standard of living to double! This is not the America our parents and grandparents knew.

We've allowed ourselves to be lulled into thinking that the bills would never come due. We've been led to believe we could keep on borrowing our children's money to finance a lifestyle we haven't earned and can't afford. It can't go on.


After taxes, the average household income in the Washington, D.C., area is the highest of all major metropolitan areas, especially in the surrounding bedroom communities of Washington where our political elites live.

How come?

Who are these people who make these big salaries and what do they do to earn them?

These are the people who go to Washington to do good and stay to do well for themselves. They take government jobs to gain expertise and add to their resumes. Then they use what they learned on our payroll to grab $500,000 consulting contracts from foreign governments and big interests. This is the famous revolving door.

The revolving door is truly bipartisan. Members of Congress, top congressional aides, cabinet members, aides to the President, and campaign officials are very happy to join hands across the aisle if it will help in the scramble to represent the big interests with big budgets to spend. You've seen them swarming at the national conventions where "hospitality" is often a polite word for something else.

Generations required to double U.S. living standards

I'd like you to ask two simple questions: First, what are they selling? Second, who needs to buy what they're selling?

To get the picture, look at the system they've created. Elections have become so expensive that our elected representatives spend most of their time raising money from special interests to finance their campaigns so they can get back into office. When they're back, they raise more money to get reelected again and again. A lobbyist walks in the door with a fat check from the special interest political action committee (PAC) he represents. If you were that elected official, you would listen carefully to what he has to say. Pretty soon, the elected person doesn't have time for his own constituents. He needs to spend his time listening to these people who give him the money to stay in office.

If you ever have a chance to visit Washington, drop in on that elected official. Chances are he won't be able to see you. He's too busy.

It wasn't always this way. When I was a midshipman in the Naval Academy, my folks and I paid a visit to Washington to see the sights. While we were touring Capitol Hill my mother decided she wanted to visit one of the senators from Texas. Here we were, a common family from Texarkana, and we walked into a senator's office and said we were from Texas and wanted to meet our senator. Five minutes later we were ushered into the office of Lyndon Johnson, majority leader of the United States Senate. Don't bother trying that today.

It's easy to see what the Washington lobbyists, political consultants, and lawyers are selling to their clients. They're selling the access you aren't allowed anymore. They make their living by "providing access."

Who are the buyers?

More and more, foreign governments and businesses are the buyers. If you wonder why international trade is not played on a level playing field, don't point a finger at the Japanese or the British or anyone else. Look first at our own political elites who enter government to gain expertise and personal contacts while on the public payroll, then leave to enrich themselves by taking inside knowledge to the other side. We've had American trade negotiators quit on Friday and show up on Monday as consultants for the country they were just negotiating with. What has happened to common decency, ethics, and patriotism among the people who are supposed to lead our country?


Whenever a citizen raises questions about the conduct of our government and its officials, our representatives look around for someone to blame. Whenever a voter asks an embarrassing question about the decline of our economy, the first reaction is to blame someone else. The President blames Congress, and Congress blames the President. Republicans blame Democrats, Democrats blame Republicans, and both of them blame the bureaucracy. The bureaucracy has caught on, too. Last year when the budget projections were wrong, the Office of Management and Budget (OMB) actually blamed the Department of the Treasury, as if Treasury was some mysterious organization located in Mongolia.

Modern politics has become little more than shirking responsibility and blaming somebody else. There is, however, a very obvious answer to this.

If anyone wants to know who's to blame for the $4-trillion debt, just go look in the mirror.

You and I are to blame. You and I are the shareholders of this country. We own it.

We allowed this system to develop where political action committees, the tools of the lobbyists, have more power than people. We allowed politicians to buy our votes by promising newer and grander giveaways (with money, by the way, they didn't have and had to borrow from our children). We allowed them to rack up deficit after deficit while we reelected them time after time.

As owners, you and I established the incentives. How could we be surprised at the results?

Why do we find it strange that the Senate voted itself a 23 percent pay increase last year after it had just approved the largest deficit in American history? Did you get a 23 percent increase last year? Do you know anyone who did? Our senators only did what they thought we would let them do. They blamed that deficit on somebody else and got on to the really important business of taking care of themselves. We did exactly what they expected us to do: nothing.

You and I didn't start this country; we didn't build it. Only a few of us have done anything to deserve or preserve it. We inherited our ownership stock.

We were given only one charge by the generations who left it to us. We were to do as they did and pass this nation on to our children in better shape than they left it to us.

Growth in Domestic Product, 1965-1989

Declining growth of U.S. business productivity

Who among us in good conscience is willing now to say that this solemn charge has been fulfilled? Which ones of us loves their country or children or grandchildren so little that they would leave behind an America weaker or sicker than the one they inherited? Who among us can look at these facts and turn away with a shrug?

These are not simple problems that can be solved with a single vote on Election Day. One person in one office will not restore excellence to America.

There is only one person in the entire world who can with character, devotion, hard work, and sacrifice create an America stronger and healthier than it is today.

Go back and look in that mirror again.

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Posted here on 5/24/97