Clearly, the recently passed Democrat sponsored $1.7 trillion dollar bill, which was signed into law by President Biden, is excessive in many ways. Most citizens don’t even realize that of the several hundred congressional representatives, only a few have actually read this bill.
Our national debt is now over $31 trillion dollars. Twenty years ago it was $6.1 trillion dollars. As a former (part-time) finance professor at a local community college, I am alarmed at the potential future financial disaster when it comes to our government servicing this debt.
Currently, federal revenue received from various types and forms (personal, corporate, business) of tax revenue amounts to $4.71 trillion annually (in 2023).
Our federal government’s current and past debt is formulated in various types of bonds, whether it is in short-term and long-term debt packages. Additionally, the cost of funding our federal government debt has increased recently due to rising interest rates. Just look at the rate of today’s 5 and 10 year U.S. savings bond rates. Both rates average around 3.8% to 3.9%.
In order for our government to service this debt, we have to pay interest of a rate of at least 3+% of our national debt total, which amounts to a little less than $1 trillion dollars annually. If our federal tax income is maintained at around $4.71 trillion dollars annually, this represents about 20% of the government’s annual income. That is a large percentage of our government’s total income.
With the continued annual growth of our federal debt, this represents a serious problem to future generations. The Democrats (who have controlled Congress for most of the last 20 years) must realize that in order to resolve this problem, they will ultimately have to increase our taxes (both personal and business). This fact explains why Biden (in this newly passed bill) has approved hiring 87,000 more IRS agents.
As American citizens, we must look realistically at this problem. As most people understand, we need to live within our means. That means that government needs to closely look at its budgets and avoid overpaying and overspending. If we don’t, our country will be facing — or in the future looking at — a financial crisis.
The last time our country balanced its budget was in the late ‘90s, when Bill Clinton (D) was President and Newt Gingrich (R) was Speaker of the House. If our Congressional Representatives and U.S. Senators really want to seriously serve their citizens, they need to seriously understand that our federal government should live within its means (another words: balancing our federal budget)!© James Lambert
The views expressed by RenewAmerica columnists are their own and do not necessarily reflect the position of RenewAmerica or its affiliates.