I was sitting at a Starbucks in Long Beach studying for my final exam on the naturally fascinating subject of Channel Coding Theory when inspiration decided to strike again. This time, it's on the subject of the economy. It's no secret that the U.S. economy is in a pretty lame state. Americans are facing inflation, a crashing housing market, a stock market in peril and that's just the tip of the iceberg. What many Americans may not be aware of is our growing national debt. And I'm not talking about personal debts (that's a topic for a different post). I'm talking about the U.S. government's debt. According to the U.S. National Debt Clock, as of September 2, 2008, America owes over 9.6 trillion dollars. With the U.S. population at 300 million, that's about $30k per person (including men, women and children)! Our country's debt increases at nearly two billion dollars a day. But, who does the U.S. government owe? Amazingly, nearly a quarter of our debt is owed to foreign governments (including Japan, China and the UK).
Here is a graph that shows how the debt has grown over time:
As you can see, except for a rise at the end of World War II, the Debt remained constant for nearly forty years. However, with the exception of a brief period between 1998 and 2000, the Debt has since increased steadily at roughly $200B/year.
Obviously, a growing national debt is bad for many reasons. The biggest reason it's bad is because when the government is borrowing money from it's citizens, the citizens have less money to buy stuff. So now it becomes harder for you to buy that new iPod or worse, gas and food. The other reason it's bad is because a large portion of our debt is owed to other countries. This puts the United States in a very weak international position and doesn't make us look good the World's eyes.
What can you do to help us get out of this mess? Vote! Go out and vote for political leaders who will make reducing the national debt a priority. If all else fails, run for office and do it on your own.
My special thanks to Ed Hall who provided me with the data for this blog posting.