Campaign ads. Robo calls. 24-hour political propagandizing and prognostications. When the election ends and we are left with our collective choice, there will be but one question: what kind of world will our children inherit?
When one considers the scope of what we will have accomplished following tomorrow's election, one cannot help but be amazed. That a nation can choose two contestants. Enable them to square off in the arena of ideas. Displace our sitcoms and Real Housewives as they debate before millions. All done without malice, violence or unrest. Culminating with a victor who will inhabit the White House in a peaceful, predetermined fashion.
Like the nation's citizenry, as well as its candidates for office, this process is not perfect. But, it remains the best the world has to offer.
Once the election is over and the prize has been claimed, what remains to be seen is what the winner will accomplish.
We hope that he chooses to enhance the future for our children by tackling the one issue of existential importance: the national debt.
Used responsibly, debt can be a useful economic tool that provides an opportunity to purchase something now for a promise to pay the debt back over time. But, when abused, debts pile up, causing systemic stress and inefficiencies. Allowed to continue unchecked, increasing debt can tarnish the reputation of the borrower. Defaulting on the debt can lead to bankruptcy and financial ruin.
While the U.S. government will never go "bankrupt" in the traditional sense, the consequences of excessive debt can still be ruinous. Economists agree that even nations arrive at a breaking point where the national debt becomes such a burden that the global community losses confidence in the government's ability to pay those debts.
The United States has maintained a national debt since the Revolutionary War, at which point the nation's debt was roughly $75 million. President Andrew Jackson soon paid that debt off. Briefly
Throughout the last 150 years, U.S. politicians have become increasingly comfortable with a growing national debt. And so they have been inclined to accept increasing budget deficits -- whereby the nation spends more than it collects in tax revenue.
In 1940, just before WWII, the national debt totaled $43 billion. By 1980, it had grown to $908 billion. This year, it surpassed $15 trillion.
Studies reveal a high correlation between high public debt and declining economic growth. No different than a business or household, when national debt is not controlled, the ability to allocate capital towards productive activities declines.
Government debt hurts the economy by degrading the financial well-being of future generations. Every time Congress approves wasteful spending, they are adding to our current deficit, depriving us of other efficient, more productive opportunities. Saddling our children with trillions in interest payments.
Instead of putting money into productive efforts that might grow the economy and create jobs while enhancing savings and investments, our deficits saddle future generations with higher tax and inflation rates. All of which diminishes opportunities for economic growth.
So, why not increase taxes? Pay our debt down?
The problem with that scenario is the lack of correlation between enhanced tax collections and increased debt reduction. The government's track record speaks for itself: when it collects more, it spends more.
So, perhaps the most effective route will be government spending cuts. And as the economy improves, tax receipts will increase, providing further opportunity to reduce debt.
This is not a problem that can be ignored. By 2020, the amount of interest on government debt alone is projected to be over $1 trillion per year. That's one trillion dollars we cannot put towards education, infrastructure, research and development, defense. A trillion dollars that my children and yours will watch their politicians turn over to their creditors: the Chinese, Japanese, Brits and Middle Easterners who own Treasuries.
Our national debt represents a clear and present danger to the nation's fiscal security. The next president must enact a plan to contend with this existential economic threat. He will have to reduce government spending. Reduce our deficit. Reduce our debt. And he must do so before we, as a nation, simply end up reduced.