At the current rate, at some point withing the next 24 to 48 hours, the US Government debt is going to hit $11 trillion. According to the US Treasury website “Debt to the Penny” as of right now (8:45pm EDT) we owe $10,951,578,308,859.02. Look at the Debt Clock at the top of this page for the current number.
That’s the US government debt only – there aren’t any firm numbers on the total state and local debt, but historically it’s about the same as the national debt.
That’s $22 trillion you and I owe to others. And that doesn’t include any credit cards, car loans, mortgages, consumer debt, etc that you may personally owe.
There are about 306 million Americans according to the US Census Bureau, so that comes out to $35,947.71 for every man, woman, and child in the US. That’s your share of the public debt.
That debt will never be paid. The US has 2 choices:
- Inflate the dollar so the massive debt can be paid back with cheaper dollars in the future.
- Default on debt payments.
Since the US government alone has the ability to print dollars, a true default will not happen. They’ll just crank up the printing press in order to create money (out of thin air) to pay the bills. And when you print money, it’s worth exactly what it’s printed on.
Supply and demand doesn’t disappear because of a government rule or law. When you print more dollars out of thin air, each dollar is worth less. Eventually, each dollar is worthless.
You don’t need to look very hard to find out what happens next. Look at Rome, Germany in the 1920′s, Argentina in the 1980′s, or Zimbabwe now. Dictatorship ALWAYS follows the anarchy which is brought about by hyper inflation.
No, I’m not optimistic that we’ll be the first country ever to break that cycle. I don’t know the time frame (1, 2, 10, 20, or 50 years) but it will happen here if we don’t stop printing and spending. Now. It’s not even tax and spend anymore, the US government has gone straight to print and spend.
Pretty gloomy huh?