The Shadow
Not since President Andrew “Old Hickory” Jackson led his administration to retire the national debt in 1835 has the US been debt free.
The US reached its debt ceiling (the amount of debt that the US government has approved) on Jan. 19, and in an unprecedented action, the government has surpassed its debt ceiling as it continues to pay its bills.
With the Republicans holding a majority in the House of Representatives and Republican Kevin McCarthy as speaker of the house, the demand for cuts in spending to reduce the national debt has been voiced.
The choices remain. One is for the House of Representatives to join with the US Senate to vote to increase the debt ceiling, raising the total amount the federal government can legally borrow and spend.
A second course of action would be to vote to shutdown government’s nonessential services such as national parks until a compromise can be reached between Republicans and Democrats in regard to the debt ceiling.
The problem with cutting spending is that 85 percent of the federal budget is used to pay for the US military, social security and Medicare, leaving only 15 percent of the budget for cutting expenditures.
Inflation has added to the federal woes by reducing the purchasing power of the US dollar while the total amount of outstanding borrowings increases.
The Second Liberty Bond Act of 1917 has created an investment source for the US Government to gain wealth, but the Federal Reserve which was established without having been voted into existence has raised interest rates recently, an act that has helped to cool inflation while negatively impacting the housing market.
President Joe Biden has stated that his administration will not negotiate with the Republicans about spending cuts, but without cuts and the raising of the debt ceiling (the amount that the federal government approves can be borrowed) a government shutdown may be forthcoming, a situation that has negatively impacted the US stock market since the debt ceiling was reached in Jan.
A trillion is a hundred million, $1,000,000,000,000, and the interest on the debt keeps mounting when the US Federal Reserve raises interest rates.
The national debt increased seven trillion dollars during President Trump’s four years in office.
The national debt was $27.8 trillion on Jan. 20, 2021, the day President Joe Biden was sworn into office.
By the end of President Biden’s second year in office, the national debt had passed the $31 trillion mark.
US Senator Joe Manchin (D) of W. Va. has called for a reduction in the national debt, and McCarthy is seeking new ways to reduce the national debt by implementing spending cuts.
