January 20, 2021

Explaining the National Debt

Posted on 13. Apr, 2012 by Stephan Helgesen in Economy

As a young father, I relished trying to explain things to my children. I wasn’t always successful, but I really loved the challenge of getting into their little minds and rolling around in all that virgin grey matter.

I think I made some headway when I encouraged them to try to visualize things – like what it would be like to be a blood platelet floating through an artery or a summer mosquito flying to treetop heights. Those experiences and others since then have convinced me that many of life’s problems can be put into perspective if only we use a little creativity and try to shrink them down to size.

Speaking of that, the old elephant quote comes to mind, “How can you eat an elephant…one small bite at a time.” And when that incremental approach is coupled with some imaginative thought, even the biggest problems can be brought into focus.

Let’s take the national debt, for example. Every person in the U.S. is on the hook for it. In the sixties,  we were all fascinated by space travel, and economists used to calculate the debt by laying dollar bills in stacks that would reach the moon. We were shocked because we knew the distance to the moon, and that example helped us understand the enormity of our debt.

That indebtedness is like a wart on an elephant compared to the $11.6 trillion economists say we will soon owe over the next few years. So, how do we get our arms around that figure? Dollar bills circling the moon several times and looping back to Earth won’t impress many of us, so I have another idea how we might hammer the point home to our fellow Americans.

Suppose the IRS sends each American family a statement in the mail for the share of the debt they owe? How would we feel opening our mailboxes and seeing a window envelope staring back at us from the Feds? Nervous fingers gingerly tear it open and find the following…

“Dear FellowAmerican,

Please be advised that the U.S. Treasury has assessed your family’s current share of our national debt to be approximately $200,000. This sum is due and payable immediately if we are to liquidate our nation’s accounts payable at this time. We at the IRS realize that the average taxpayer might not be in a position to pay this debt in one lump sum so we are offering you three options.

The first option is for you to begin making payments to us at the rate of $10,000/month (figure adjusted for interest) over the next two years.

The second option is for you to transfer the responsibility of that debt to your children and grandchildren who may pay it to us over the next 10 years.

Please bear in mind that because our debt is increasing at the rate of $3.0 million a minute, the actual amount your children or grandchildren will owe could be considerably larger than the current sum, as it will include interest at an indeterminate percentage (this will depend on the interest rates our Treasury Bills will be required to pay to foreign investors along with the rate of government spending).

There is a third option (though it is not within our agency’s purview to recommend it).

We call your attention to the national elections that will be taking place in November.

Should you decide to vote for candidates who support dramatic curbs on federal spending or espouse balanced budget amendments, their election and subsequent decisions may reduce your family’s indebtedness and therefore your family’s total financial obligation to us. Please check the box alongside option one or two…or check the appropriate box on your ballot on November 6, 2012.

Sincerely,

Your friends at the IRS”

I haven’t asked them, but I think my children would be pleased that their old dad is still trying to explain the inexplicable.

- Editor

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