Oonly one in five Americans believe that inflation is the main economic crisis facing America. Still, the inflation rate will likely fall over the next few months as the Federal Reserve makes borrowing expensive. But the debt that the federal government has accumulated by sending covid-19 stimulus checks, welfare checks, Medicare checks, Medicaid checks and Social Security checks will plague the United States for the foreseeable future.
While sending $804 billion to low- and middle-income households through three rounds of covid-19 stimulus payments, the federal government spent all of its tax revenue on social welfare programs during the pandemic. Consequently, he had to borrow money to fund the army, run the government, and pay interest on the national debt. This borrowing increased the national debt by over $6 trillion.
Debt has put America on a path to financial ruin and is the nation’s biggest true economic crisis.
In addition to the $30 trillion national debt, the federal government has made unfunded promises for Medicare and Social Security. He has promised $103 trillion more in future Medicare payments than it will be able to collect through taxation. And he has promised $60 trillion more in future Social Security payments than he will be able to raise through taxes. That means these mandatory fees will likely eat up 80% of tax revenue a decade from now when Medicare and Social Security funds are on the brink of bankruptcy.
The Biden administration has not addressed this crisis except to report that Social Security recipients will likely see an 8.9% increase in their monthly checks Next year. This increase is reasonable given the current rate of inflation, but will cost taxpayers billions. Bloomberg financial analysts Dave Merrill and Chloe Whitaker believe that America needs millions more taxpayers to keep the current social security system solvent. But to get those taxpayers, the nation has to double its birth rate or its immigration rate. Otherwise, America’s 70 million Social Security recipients could see their checks drastically cut.
Financial analysts used to estimate that the Old Age and Survivors Trust Fund would run out by 2034, but the number of people who retired during the covid-19 pandemic postponed this date until 2033.
“Make no mistake about it, this impending fiscal calamity will be a grave threat to our future at every level and to nearly every home in the country,” Kristin Tate told the Hill wrote about this impending Social Security crisis. “Where are the news reports and opinion pieces like the ones we see on climate change or government obscurity that threatens to kill democracy? Immediate reforms are needed to avoid a fiscal fiasco that will mirror the crisis of the European Union a decade ago or the precursor to the French Revolution.
For most of American history, people have managed their own retirement accounts or relied on their children to care for them in old age. But since 1935, many Americans have turned this vital component of financial planning over to the federal government, and the results have been disastrous. The average American worker contributes $3,045 to the social security fund through payroll taxes every year, but they may never see that money again because the government mismanaged the accounts.
America’s $163 trillion in unfunded pledges dwarfs even its $30 trillion national debt. And that could lead to a French Revolution-style insurrection when the 60% of Americans who receive more government benefits than they pay in taxes realize that the benefits may not last very long.
Since taxpayers will ultimately be responsible for the $30 trillion national debt and $163 trillion in unfunded Social Security and Medicare liabilities, every man, woman and child in America owes $572,000. So there is no way for them to repay this huge sum while saving for retirement and buying the necessities of life.
The Bible tells us, “The wicked borrow and cannot repay…” and “A good man leaves an inheritance to his children’s children…” (Psalm 37:21; Proverbs 13:22; Revised Standard Version). Yet Americans are preparing to leave their grandchildren destitute with a huge debt several times the size of the global economy.
Nathanael Blake at Federalist noted, “Federal deficit spending is not like going into personal debt. It’s like grandma going on a binge with her grandkids’ credit cards. These are parents who are now giving up their children’s future in exchange for government subsidies. It is wrong to place our children and grandchildren under enormous debt.
The Roman Empire fell when the state could no longer obtain sufficient resources through taxation and was forced to depreciate its currency to increase its revenue. Diocletian’s tax reforms were so draconian that many landowners were driven into bankruptcy, as those living on welfare outnumbered those paying taxes. Robert Adams summarizes this catastrophic history in his book decadent societies, saying that “as early as the fifth century, men were ready to abandon civilization itself to escape the formidable burden of taxes”.
This is an important story to consider when reading headlines like “You owe over $500,000 and counting.” America is going the way of Rome unless God steps in to perform a miracle – and He won’t until the nation repents of the materialism and other sins that brought it to the brink of destruction. destruction.
For more on the existential threat debt and out-of-control spending pose to America, please read “America’s Greatest National Security Threat”, by Trumpet editor Joel Hilliker.