Check please!
On Monday morning, the USA Today greeted us with the following alarming headline: “$84,454 is the average household’s personal debt. ; $473,456 is the average household’s share of government debt, including Medicare and Social Security. The government isn’t asking you to pay it. Yet.”
Pretty incredible, right? Currently, the market is essentially rising right along our increasing indebtedness (for example, see “Melting Up“). We have had debt scares before, and we seemed to make it out just fine? I remember when many folks were certain the country was going to go belly-up in the 1980s as we piled on what was then record amounts of debt. In fact, I never cease to be amazed at the capacity of this country to absorb the kinds of debt levels that would make the IMF (International Monetary Fund) shake in its boots almost anywhere else on the planet!
How do we do it? I wish someone would explain it to me. The perma-bears have certainly rung plenty of alarms, but their theories are always getting abused by what the market really does on the ground. Logic and intuition tells us that a day of reckoning must eventually come home to roost, that the waiter (mainly China and Japan!) will lose his patience and present us with the monstrous check, but it remains difficult to plan appropriately for something that boils so slowly. The scale of this thing is so grand, it is hard to do anything but to continue as we always do.
So, as we proceed to indulge oursleves at the Chateau d’Largesse, let’s agree to pretend the night is still young. Let’s agree not to exclaim “check please!”…I think I left my wallet at home. 
This post has 2 comments
October 8th, 2004
This is one of my biggest concerns for the US economy. Deficit spending is the reason I don’t consider the Republicans to be Conservative anymore. There is nothing conservative about the amount of borrowing we are doing to fight wars we can’t afford.
I think one day, in my lifetime, I will wake up and realize that China owns us and I will have now one to blame but ourselves. This is the reason I think Iraq is mistake. We simply can not afford it.
October 8th, 2004
I will take the bait and make my *one* political statement as a guest writer here… I don’t believe it is an accident that we choose to fund America’s increasing commitments domestically and internationally by cutting taxes more and more. 1) There is a *hope* that lower taxes will lead to a robustly growing economy that will grow us out of debt, 2) If #1 doesn’t work, then we will be *forced* to make deep and drastic cuts to numerous domestic programs across the board, largely without regard to social consequence. In the current climate, noone is willing to pay more taxes, and noone dares spend less on programs and departments that defend the homeland. All are consistent with current conservative values (economic growth, smaller government but bigger military, and low taxes). I might add that these are not necessarily inconsistent with current so-called liberal values either. These days, it seems to be more a matter of emphasis than of substance. That’s the two cents that I owe.