Tuesday, January 04, 2011

US national debt tops $14 trillion for the first time

According to the United States Treasury (Web site), the national public debt eclipsed $14 trillion on December 31, 2010.

This is the first time in history the debt has topped $14 trillion, and it brings to light several important issues which will demand immediate attention by the next Congress.

The first one is the sheer enormity of the debt itself. As we have said before, the per capita debt load (what it will cost each individual American) is now well over $45,000, and it exceeds 90 percent of our nation's gross national product. The debt has also risen sharply over time. When President Obama took office on January 20, 2009, the debt was $10.626 trillion, meaning that over the past two years, the national debt has increased by about 31 percent. Accumulating the first $13 trillion debt took our nation decades, but adding on the last trillion dollars took only about six months.

The second is the fact that a large share of the public debt is held by foreign nations, which complicates United States foreign policy. We cannot expect to exert independent influence in the foreign policy arena when about one-third of our debt is held by international power brokers.

The third issue is the statutory debt limit (how much money the government can borrow without receiving additional authorization from Congress), which was increased from $12.394 trillion to $14.294 trillion effective February 12, 2010. There is increasing pressure to increase the debt ceiling so the United States can borrow more money, but this is receiving opposition from House Republicans who say it's irresponsible to keep running up the meter on our debt.

The crushing burden of our national debt is an extremely important issue for everyone in the country, both now and for future generations. Congress must make it a top priority to start bringing down the size of the debt. And, there should be no increases in the debt ceiling unless necessary to avoid default, and then only if there are strict benchmarks put in place to reduce the size of the debt over time.

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