America’s National Debt: A Rendezvous with Reality?
Did you realize that the federal government now overspends more than $6 million each and every minute? Every single day, Washington digs the national debt hole nearly $9 billion deeper – adding more than $3 trillion a year to what we owe as a nation. At this pace, each of us, our children, and their children’s children, will be on the hook for more than $30 trillion by the end of 2021.
Counting by ones, it takes more than 32,000 years to count to one trillion. And that’s allotting only one second for numbers like nine hundred and ninety-nine billion, nine hundred and ninety-nine million, nine hundred and ninety-nine thousand, nine hundred and ninety-nine. You get the picture. One trillion dollars is a lot of money, and $30 trillion is beyond unfathomable!
Maybe that’s why no one really keeps track any more. A trillion here. A trillion there. Not to mention, the U.S. also has $162 trillion in unfunded liabilities – which includes federal entitlement programs such as Medicare, Medicaid and Social Security – that is not included in our “official” national debt. The federal government has set aside $0 to cover these unfunded obligations.
In 2013, the Utah Legislature passed a slate of bills called Financial Ready Utah. One of the bills created a Federal Funds Commission to monitor the impact of federal overspending on the state. Another bill requires every state agency to have an emergency action plan in the event of a 5% or a 25% reduction in the amount or value of funds from the federal government.
The Utah Association of CPAs (UACPA) was among a host of organizations supporting this bipartisan effort. The UACPA brought in a national speaker who had been a member of the Government Accounting Standards Board (GASB). Over breakfast, I asked him why the federal government doesn’t have to book all of its obligations like every business or local or state government has to? He responded, “That was my first question at my first GASB meeting!” I leaned in to hear the answer, “The federal government is just different” was the reply. He persisted in advancing the question, receiving only evasive responses in return.
He insisted on a substantive answer to the question in order to fulfill his service on the board. They reportedly told him, “We know the federal government can never pay these unfunded obligations, so they are not considered real obligations. Therefore, they are not included as financial obligations on the federal government’s books.”
Think about that for a hot minute. The federal government’s insolvency is so very real that it doesn’t consider the very real federal promises, made to very real sick, poor and elderly people, to be real obligations. The implications are staggering.
Andrew Johnson once quipped, “Washington is 12 square miles bordered by reality.”
The reality is that for more than a decade, the U.S. Government Accountability Office has cautioned “The Federal Government is on an Unstable Fiscal Path,” adding, “Growing debt is not just a number—it represents a threat to our economy and our ability to meet national needs and priorities.” For more than a decade, national security leaders have warned that the national debt is a “top national security threat.”
Alarmed by this unfolding crisis, South Carolina is poised this year to become the 34th state to apply under Article V for a convention for proposing amendments to the U.S. Constitution to impose fiscal restraints on the federal government.
“Through Article V of the U.S. Constitution,” the ALEC Article V Handbook for State Lawmakers notes, “our Founders opened a pathway for the American people, acting through their state legislatures, to bypass Congress and promote constitutional amendments.”
South Carolina State Senator Rex Rice is co-sponsoring an Article V application, “call[ing] on the Congress to designate the date and location of the Article V balanced budget amendment convention within 60 days…”
Washington will continue to “swindl[e] futurity on a large scale” (Thomas Jefferson) through printing, borrowing and spending until restraints are imposed. A convention of States for proposing amendments regarding the fiscal well-being and security of our nation is the most potent tool the Constitutional Framers entrusted to the States to preserve our union.
John Adams observed “[t]here are two ways to conquer and enslave a nation. One is by the sword. The other is by debt.”
Because our federal officials show no willingness to protect our nation from the enslavement of debt, it rests with the states to secure our future.
For this reason, the Functional Federalism Working Group is devoting our April meeting (Friday, April 30th at 3:30pm ET) to an exploration of America’s looming debt crisis and the responsibility and the powers that States have to avert the “rendezvous with reality” that continued reckless spending portends.
Contact Karla Jones at kjones@alec.org to register to attend the next Functional Federalism Working Group meeting.