🚨🚨 NERD ALERT!! 🚨🚨
This is a post that contains numbers, facts and figures… We don’t do this too often (literally once or twice before). Buy hey, if that isn’t your speed, might I suggest re-watching Ketch’s hot dog eating contest! But if that does sound like your cup of tea, make sure your TI-89 calculator has fresh batteries, cuz it’s time to rock!
I’ve always thought about this but never did the research, however, today was the day. Today, I put aside my (actual paying) job’s work and said, “No more! Let’s get to the bottom of this!”
The question is…
“Is there ever a point of no return when it comes to the National Debt?“
What I mean by that, for those less financially thinking, is: will there ever be a point that our debt gets so big that it’s impossible for us to pay back?
So today I did a quick lookup of how much the national debt is today. And the answer is just shy of $22 trillion.
Okay, that sounds really high, right? But just how high is it?
Well, to compare that as a total of how much we owe TOTAL versus how much tax payers pay in every year, the total tax revenue that the US government brings in is $3.4 trillion…
That means that even if we took ALL our taxes and paid it straight toward our debt, it would take six and a half years worth of taxes to pay that debt down to $0… That means no funding for anything else – healthcare, social security, military, unemployment, the wall (lol), roads/bridges, etc.
Oh, AND don’t forget the debt we have is going to have interest against it… So let’s assume the interest ON AVERAGE being charged against our debt is 4% (pulling that percent completely out of my ass), that would total just shy of $1 trillion*. Which means that we would be paying almost $1 trillion of our $3.4 trillion in tax revenue for INTEREST ALONE on what we owe and only reducing our deficit by .69 (nice) trillion each year, which means that if we paid EVERYTHING WE HAD to pay our debt down it would take almost nine years…
OH! Buuuut (again) don’t forget that in order for the US government to get the $3.4 trillion in revenue, it costs money too! People need to process our taxes, right? The 75,000 workers (per 2017 numbers) at the IRS don’t work for free! So how much does that cost? They estimated $11.5 billion.
Yes, $11.5 billion is small potatoes compared to the $22 trillion debt total or the $3.4 trillion in revenue, but every dollar counts, right? RIGHT?
Listen… My scenario of our debt being charged an interest rate of 4% is honestly VERY conservative as far as what people can charge on debt… And I’ll never know the rates, terms and agreements for all $22 trillion, so using 4% was just a hypothetical.
If that hypothetical number is more like 8%, interest alone would be $1.76 trillion and it would take 12 and a half years… again, with no money going anywhere else.
Now, people may tell me there is revenue from trade deals and other things, and feel free to let me know what those are, but the thing I wanted to know is: when does this all hit a point of no return?
We pass budgets where we KNOW we’re going to run trillion dollar deficits (which is insane), so we know we are only going in the wrong direction.
If our debt ever hits $40 trillion, then the interest alone (at 8%) would be $3.2 trillion and our (current) total tax revenue would only be able to pay the interest alone**… basically.
I don’t know, I just think this whole national debt conversation has been a can kicked down the road for so long that we’re now completely fucked and should start learning Chinese and Japanese because they’re going to own our asses pretty soon (they already own about 10% of our debt).
This topic makes my blood boil because it shows the unreal ignorance to the fact that government programs cost money, and we simply can’t afford most of what we pay for! I agree that these programs are nice, but if you can’t afford something, you can’t have it!
Taxes are a necessary evil, I get that… But government spending needs to be reeled in MASSIVELY.
Right now, my 2028 Presidential platform is going to be just that… Fix the problems everyone else left for decades.
Make America Solvent Again,
* = $880 billion to be exact
** = AGAIN WITH NO MONEY TOWARD ANY PROGRAMS!!