This New Year’s resolution for every citizen and politician should be, not to spend the money that we don’t have.Millions of Americans have ended up with huge credit card debts and foreclosures because of their spending habits.As a result of this, most Americans are experiencing low wages, unemployment as well as loss of unemployment benefits.The minimum payments that they are making every month barely cover the interest while the principal is a huge amount.Most of this has been their own doing and while one can feel some empathy for them; this could have easily been avoided.
As the U.S. Debt clock has rapidly approached $14 trillion it sums up to around $44,740 per citizen and government debts will affect all U.S. citizens.The debt per taxpayer is steadily climbing every second and is at $125,866 and these figures are after eliminating the ones that don’t pay their taxes.The debts are likely to rise further and much faster when the present low-interest rates begin to rise.
The nation is moving very close to insolvency and at a rapid rate.The question here is ‘what will happen if the United States goes broke, if the financial problems in Ireland and Greece can have such a bearing on the worldwide economy?’While few wish to address this question, it is certain that national security will pose a major threat due to this.
Although this problem is not new, and the previous administration has failed to find solutions for shortfalls in budget and has not handled this issue in an aggressive manner as this could easily be passed on to the future administrations.
If action is not taken quickly, all of these increasing costs with regard to healthcare, rising interest rates, Social Security and Medical Security etc will take away the entire budget by the year 2025; as per the National Commission on Fiscal Responsibility and Reform, which is the bipartisan commission that has been appointed by President Obama.All the other expenditure on infrastructure, education, and national security will have to be borne with borrowed money that will only help in increasing the debt further.
President Obama has issued a six-point plan in his ‘The Moment of Truth’ where the agenda is to shrink the debt.He deserves credit for appointing this commission and as per the recommendations there would be discretionary spending cuts, comprehensive tax reforms, health care cost containment, mandatory savings, Social Security reforms, and process changes.