The U.S. public debt is $7.7 trillion. The annual interest on it is $120 billion. Total receipts for fiscal 2005 through December were $487 billion. Total outlays were $605 billion.
There is a line from one of Charles Dickens’ novels that goes something like this: Income 21 shillings, outgo 19 shillings equals bliss. Income 21 shillings, outgo 22 shillings equals misery.
It is a simple truth that anyone — a person, a family or a government — who spends more than what is taken in will eventually be bankrupt. Most of the politicians in Washington, including the president — not to mention most Americans — seem unconcerned about this pending disaster.
How many people have to work how long just to pay the taxes necessary to cover the annual interest? That $120 billion goes right into private and corporate pockets before the government even buys a pencil, much less performs any services. To most of us, billions and trillions of dollars are inconceivable, and therefore we tend to look upon them as abstractions that have no meaning.
They do have meaning, because every penny the federal government takes in must of necessity come out of the labor, sweat, savings and earnings of the American people. Money the government takes from us is money we don’t have to feed our families and provide them with medical care and with shelter.
There’s your best argument for small government. We need government, and we must pay for it. But if government gets too big, it becomes predatory and impoverishes people rather than helps them.
Governments, of course, don’t go bankrupt. They usually resort to inflating the currency. That not only cheats the creditors by paying them off with dollars that won’t buy much, but it also robs the people of their earnings and their savings. Our government, in cahoots with the Federal Reserve System, has been systematically inflating the currency for years.
A dollar in 1967 would buy four gallons of gas. Today, it will not buy one gallon. You have to remember, our currency is backed up by nothing. You can’t exchange a dollar for gold or silver. Therefore, its purchasing power depends on how many dollars there are in circulation. The more dollars, the less each one buys. So for years, Congress has been flushing more dollars into the system to cover its deficits and reckless spending.
Now, most modern politicians being liars, they are always trying to cover their tracks. They want you to concentrate on the monthly figures, which are reasonably low. What they don’t tell you is that inflation is cumulative. The sum of low annual rates added together equals a large loss of purchasing power.
Another trick they use is to constantly change the base year by which purchasing power is measured. If they still used 1967, it would show that the dollar has lost almost 75 percent of its purchasing power, so they set a new base year every 20 years. That means, for example, a $10,000 life-insurance policy purchased in 1967 would today pay the beneficiary about $2,500. The other $7,500 has been stolen by the government.
I’ve always been puzzled about why so many Americans are so easily satisfied by their politicians. I suppose it’s a combination of low IQs, inadequate education and naturally trusting nature, further helped by incessant distractions and entertainment.
The American people deserve a sound currency that keeps its value. They deserve a frugal government that will not burden future generations with debts for things long ago consumed. Thomas Jefferson said that no government debt should extend beyond 20 years, generally considered one generation.
As we say in the South, the American people are being screwed, blued and tattooed by the politicians in Washington, and most of the people don’t even know it. They are suffocated by the incessant amount of fertilizer poured on them by the smiley, overpaid, overperked, overpensioned politicians who have voted themselves into the top 5 percent of income. Public servants, my foot.
Charley Reese [send him mail] has been a journalist for 49 years, reporting on everything from sports to politics. From 1969 to 1971, he worked as a campaign staffer for gubernatorial, senatorial and congressional races in several states. He was an editor, assistant to the publisher, and columnist for the Orlando Sentinel from 1971 to 2001. He now writes a syndicated column which is carried on LewRockwell.com. Reese served two years active duty in the U.S. Army as a tank gunner. Write to Charley Reese at P.O. Box 2446, Orlando, FL 32802.