America is the greatest country in the world yet our continued greatness is threatened by our growing national debt. Fiscal irresponsibility can cause a great nation to decline. As our debt piles up, the more we have to pay to service it, the less money there is for defense, education and other programs.
In 1965 mandatory spending consumed over a third of the federal budget and today it is approximately two-thirds. In nineteen years there will be no funds left over in the discretionary budget which funds our armed forces.
An example of rising deficits:
Source: US Government and usdebtclock.org
When the government spends excessively, the economy suffers, unemployment rises and taxes increase. Why does that happen? The government does not create jobs; they destroy jobs when they spend excessively because they take resources from the private sector.
Interest on National Debt: In ten years our country’s interest payments on the national debt will be almost four times what we spend on education, energy and transportation combined. What is alarming is that the net interest spending today is at historic low interest rates, which obviously will rise, and then both the world and U.S. economies will go into an inflationary cycle.
Ultimately, the national debt and interest payments on that debt will rise and the U.S. will then be in a vicious cycle of competing with other nations to borrow money. Higher interest rates will slow down our economy as it will cost not only businesses more to invest but for families to purchase goods and services.