Let’s Talk About Debt, Baby!

Let’s talk about debt, baby!

Let’s talk about you and me.

Let’s talk about all the good things and the bad things that may be.

Let’s talk about debt. Let’s talk about debt!

Do I have your attention? Good! We have a crisis in our nation right now, and it centers around debt. We owe a ridiculous amount of money to various entities, and we have almost no way out of it. The so called leaders in Washington are not tackling it in a mature manner and only causing it to get worse.

Now, on an individual level, some debt is considered good to have. A mortgage is good (in most cases). Student loans aren’t horrible. Even having some credit card debt is okay. These are all considered debts that can improve your personal quality of life. They can raise your credit score, allow you to get a degree to potentially earn more money, and help you move forward in life. You might even say they are the building blocks for life, liberty, and the pursuit of happiness!

But that is vastly different than what our local, state, and most egregiously, federal governments are doing.

I want to focus on our federal government because that impacts each and every one of us equally.

Did you know our debt is sitting at $28.5T and climbing? That works out to around $474,373 per citizen. That’s not per tax payer, that’s per citizen. Which means each baby born is already saddled with a tremendous debt. It’s overwhelming and seems impossible to dig ourselves out of it.

One of the key things Congress is SUPPOSED to do is work on a budget to help REDUCE the debt and make our country more fiscally responsible. Did you know that we have funded such things as the exercise habits of shrimps and teaching Chinese escorts how to not get drunk while entertaining their customers? While neither of those even scratches the surface of our budget woes, the fact that they existed in the first place is troubling.

Another thing we’ve grown fond of is simply printing more money to pay off our debts. This is called quantitative easing (QE) and is the number one cause of inflation. While it can temporarily help spur the economy, continuing to do it eventually hurts the economy.

The more there is of something, the less value it actually has. Think of it in terms of a limited edition art print. Those are numbered and often come with a certificate of authenticity. The lower the number of prints, the higher the value is. Our paper money USED to be limited editions. Now there’s so much out there, each bill has lost value…a lot of value.

Do you know about our debt ceiling? It’s this vague line in the sand where we are SUPPOSED to stop spending once we reach it. It is meant to be the stopping point for borrowing money. And if it worked that way, we might not be in the mess we are currently. Unfortunately, Congress continues to vote raise the debt ceiling. That’s right! If we get close to it, they just decide to raise that mythical number so that they can keep spending and borrowing.

What if you did that with your household budget? You know you don’t actually have a way to pay back the debt you already have, yet you ok yourself to borrow more to pay down what you already owe. Doesn’t make much sense does it?

Oh, but don’t worry! What Congress also does is raise taxes. You see, the government doesn’t actually make money. They aren’t a business. The only influx of money to them is through taxes, fees, and the aforementioned QE. They push the burden of their spending sprees onto the tax payers and call it “problem solved”. Only it hasn’t solved the problem because then Congress finds new and inventive ways to spend the extra tax money.

There are a few different levels of spending. The first is using your own money to spend on yourself. In this scenario, you tend to be a bit more cautious about the quality of whatever you are spending the money on. You want to make sure you are not going into debt, but that you also get a solid product.

The second is using your own money to spend on someone else. In this case, you start to sacrifice quality. You become less selective about the actual product and more about the gift giving itself. Giving someone SOMETHING makes you feel good, right?

The third is spending someone else’s money on yourself. Now we’re cooking with gas. You start to not care as much about how much you spend because, well, it’s not YOUR money! You seek out the highest quality you can and let someone else foot the bill.

The final one is spending someone else’s money on someone else. Here you couldn’t care less about the cost or quality of whatever it is you are buying. It’s not your money and it isn’t something for you. So who cares if the product is cheaply made, but costly to purchase? This is our Congress. This is what they do. They take taxpayer money and spend it like drunken sailors.

We need to get back to fiscal responsibility. Those budgets where certain groups claim they are getting “less” than years previous, it’s simply not true. What they aren’t getting is the normal upped amount they have come to rely on in years past. What would happen if we suddenly defunded…everything on a federal level. What if we took the tax money and actually PAID DOWN the enormous debt we’ve accrued?

Yes, this is an extreme solution, which virtually no one can get behind. So let’s find a good balance.

Let’s really go through the budget and ask the question of each and every item: If we cut this, will the country still operate just fine? If the answer is yes, cut it. If the answer is no, then let’s work to find the absolute bare minimum to throw at it.

Will we need to tighten the belt to get us back on level footing? YOU BET!!! Is it worth it in the long run? ABSO-FRIGGIN-LUTELY!!!

I’ll close with this scene from the movie Dave. It is a classic film and this scene is iconic. Yes, I know it is a movie and our budget is extremely complex, but every budget can be slashed. We just have to have the hutzpah to do it.