The Problem

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The basic Financial problem that America faces is it is spending more than it is taking in. In theory, the solution is to spend less and or take in more. Unfortunately, in our divided government we have one party that doesn’t want to spend less and the other party doesn’t want to take in (tax) more. In 2015 our national debt was $15.8 trillion, less than 10 years later the debt has grown to over $34 trillion. Our national debt is now growing faster than our economy (our GDP, our Gross Domestic Production). This is unsustainable in the long run. There are two major drivers to this debt and our growing annual financial deficits, entitlements< (primarily Social Security and Medicare), and interest we pay on our debt. Social Security spending already exceeds $1 trillion a year. Medicare spending will exceed $1 trillion a year by the time we celebrate America’s 250th birthday. Interest on the debt could hit $1 trillion a year within the next couple of years if interest rates remain high and we need to pay higher rates to entice the purchase of our Treasury securities. If we cannot control these expenses, it will ultimately lead to fiscal collapse as the dollar loses its standing as the world’s currency. 

Politicians have failed to address these issues because to do so might jeopardize their next election. Facts are facts and the longer our government refuses to address this issue the more painful will be the result.