Dear editor,
You or someone in your family may have or had debt: to buy a car, residence (mortgage) or to pay medical expenses not paid by insurance. Companies will lend to you only if your credit rating is good; worse your credit rating, higher interest rate you are charged.
Governments have debt too. Legislators often pass legislation to give voters what they want, but do not pass legislation to provide taxation to cover expense. Where does needed remaining money come from? Government borrows it. This works nifty for legislators, because by time voters realize what they have done (if they ever do), legislators may have been reelected, retired, and live in house near water where they can watch their grandchildren play in surf.
Among states, California’s debt is highest, but debt of Illinois is high also. “State and local government debt in Illinois for fiscal year of 2024: Illinois' state debt stood at about $69.79 billion” (Statistica Jan. 7, 2025). This amounts to $5,491 per person (population 12,710,158, (US Census Bureau, QuickFacts: Illinois July 1, 2024). Although some improvement in Illinois finances has occurred in last several years, prospect for coming years does not look good. (Capitol News Illinois, Pritzker’s Budget, Nov. 4, 2024). Illinois debt, high as is, is chicken feed compared to debt of Federal Government: over $36 trillion (www.usdebtclock.org, and watch it rise!). This amounts to about $105,000 per person in US (Worldmeter, Feb. 8, 2025: United States Population, 346,549,989). “Over the last decade, the U.S. has almost doubled its outstanding debt” (CBS News, US Interest Payments, March 1, 2024). “This astronomical figure continues to raise concerns about its long-term sustainability. As U.S. Federal Reserve Chairman Jerome Powell has pointed out, U.S. debt is growing faster than the economy, making it unsustainable in the long term.” (TheConversation, U.S. National Debt Nov. 21, 2024). These huge interest payments cause our country to have less to spend on infrastructure, job training, research, medical care, social security, commercial investment and defense.
Government debt continually comes due, is paid, then new debt sold to replace it. (This is like vehicles on a stretch of road at one moment: some come, some leave, but number on stretch remains about same.) If debt buyers become nervous about ability of government to repay debt (decreased credit worthiness), they would demand higher interest to buy it. In this way interest payments by government would rise higher, causing even more load on government’s ability to pay and raising interest rates nationally, which would further decrease economic activity. Result: recession or, worse, depression.
[Republican] Speaker Johnson: National debt is biggest threat facing US (NewsNation, Jan. 28, 2025). I agree, with possible exception of current cabal in Washington D.C.
“Under Democratic presidents, Donald Trump repeatedly demanded Republicans in Congress use the federal debt ceiling as leverage for their political demands. Now, as he prepares to return to the White House, Trump is calling for the elimination of the cap on government borrowing.” (Michigan Independent, Trump says Jan. 7, 2025).
“Congressional Republicans’ plan for a massive extension of the Trump-era tax cuts comes with a hefty price tag: up to $5.5 trillion over the next decade if extensions of certain business provisions are also included. The majority of these benefits would flow to wealthy individuals and businesses, leaving everyone else with a token tax cut and saddling the nation with a massive increase in the national debt.” (Institute of Taxation and Economic Policy, Congress Could Jan. 17, 2025). This quotation is opinionated, but is it wrong?
“No matter how committed Donald Trump and his oligarch cronies are to a tax cut, the laws of arithmetic cannot be repealed. If only a handful of Republican lawmakers keep their promise not to increase the US budget deficit, there is no way that the incoming administration can enact its economic agenda and keep the government running.” (Project Syndicate, Trump is on a Collision Jan. 6, 2025).
“Donald Trump has big plans for the economy — and a big debt problem that will be a hurdle to delivering on them.
“Trump has bold ideas on tax cuts, tariffs and other programs, but high interest rates and the price of repaying the federal government’s existing debt could limit what he’s able to do.
“Not only is the federal debt at roughly $36 trillion, but the spike in inflation after the coronavirus pandemic has pushed up the government’s borrowing costs such that debt service next year will easily exceed spending on national security.
“The higher cost of servicing the debt gives Trump less room to maneuver with the federal budget as he seeks income tax cuts. It’s also a political challenge because higher interest rates have made it costlier for many Americans to buy a home or new automobile. And the issue of high costs helped Trump reclaim the presidency in November’s election.
“‘It’s clear the current amount of debt is putting upward pressure on interest rates, including mortgage rates for instance,” said Shai Akabas, executive director of the economic policy program at the Bipartisan Policy Center. The cost of housing and groceries is going to be increasingly felt by households in a way that is going to adversely affect our economic prospects in the future.’” (Associated Press, The Rising Price Nov. 24, 2024).
In closing, legislators in Washington D.C. have brought to us burden of this huge debt and they watch it as it continues to grow, weakening our country for many years to come; more precisely: permanently.
-Henry Tideman, Oregon
