Question: Do you know how much tax revenue the United States collected last month?
Next Question: Do you know how much the United States spent last month?
These are numbers are available to you simply by visiting Congressional Budget Office website HERE.
Just like the equation: INCOME – OUTGO = EXACTLY ZERO ™ applies to you and me, it also applies to governments and businesses.
In January, the CBO estimates that the U.S. spent $10 billion more than was collected. For the first four months of fiscal year 2014, we have spent $184 billion more than was collected.
Here are some reasons you should care about these numbers – especially if you are a citizen of the U.S.
- Increased deficits means more national debt. And the taxpaying citizens will have to pay this interest as well as repay the debt (which is in excess of $17 trillion).
- No balanced budget requirement for the U.S. means deficits will continue. Just as having no personal budget will tend to lead to overspending. I, for one, would love to see some requirement that my beloved country would have to save money and follow the I Was Broke. Now I’m Not. Ladder!
- You are already feeling the impact of the national debt, and it won’t be getting lighter. There is relentless borrowing from the Social Security trust fund. Don’t just take my word for it – read the report issued by the Social Security Administration HERE.
I’m only voting for representatives who demand a balanced budget. I feel that would be most “representative” of me – and will help the U.S. continue to prosper into the future.
If you are a resident of the United States of America, you should be paying attention to the financial dealings of our leaders.
Here’s why: Their financial decisions WILL affect you!
Here are some examples:
- Interest Payments The national debt is just like YOUR debt – there is a BORROWER (the U.S.) and there is a LENDER (U.S. Citizens, Other Countries, and Outside Entities) Like any debt, interest must be paid. The United States just completed its 2013 fiscal year with interest payments of $415,688,781,248.40! Here’s a great question to ask: What ELSE could we have done with $415 billion?
- Credit Rating Reduction The U.S. has had its debt downgraded by Standard & Poor’s on August 5, 2011 and Fitch has warned of a possible downgrade in October 2013. This will increase the amount of interest the U.S. will have to pay on new debt issues.
- You and I (the taxpayers) will have to pay up (and so will our children and grandchildren) Budget doesn’t force “Income – Outgo = Exactly Zero” In fact, we PLAN to spend more than we make each and every month/year/decade. This is ridiculous and reflects a lack of financial education. Spending more than I make for months and years would never work for me personally, and it definitely won’t work for our government. I simply do not understand why a “balanced budget” is not a written and followed law.
- Your money is devalued As the government prints more money, it devalues existing money. MANY MANY MANY times in history, this “let’s just print more money” approach has led to hyper-inflation and currency collapse (Argentina 1991 and Mexico 1994 are two examples – Greece, Cyprus, Ireland, and Spain are all experiencing similar issues leading to major devaluation)
Here are some helpful websites that can help one better understand the debt held by the United States:
- Current U.S. Debt This is the official debt number from the U.S. Treasury.
- Monthly U.S. Budget Review This is the official math from the non-partisan Congressional Budget Office (CBO)
- U.S. Debt Clock Provides many different perspectives of the current financial position of the U.S.
Actions YOU can take:
- Email your elected representatives Tell them you want them to make wise financial decisions that position the U.S. to have strong financial fundamentals: (1) a balanced budget, (2) financial reserves, (3) debt reduction plan, and a (4) economic investment plan
- Live these principles in your own life We elect people who are a direct reflection of who we are. Right now, as a collective group, U.S. citizens spend more than they make. Consequently, so does our government. What if we, as a collective group, lived within our means? I believe we would elect leaders who represent those same values. By the way, this is not a Republican versus Democrat issue – it is a “We the people” issue!
The US National Debt has increased by $755,668,013,559 since our last update on January 2013. Another eleven months, and the United States has dropped another cool $755.7 billion in the hole.
National Debt as of 12/02/2013
That is an increase of $2.347 BILLION PER DAY since our last update 322 days ago.
BUT – FINALLY – There is SOME good news!
According to the Congressional Budget Office (CBO.gov), the United States has closed the deficit gap by more than 50-percent!
The deficit gap has been closed by several factors, including:
- Increased tax revenues from a recovering economy
- Increased tax revenues from new taxes
- Decreased expenditures – due to sequestration
You can read the CBO’s entire report HERE.
If you aren’t already, I encourage you to become an informed taxpaying citizen. You CAN make a difference in the future decisions that are made regarding the fiscal decisions your elected leaders make.
Here are some facts I found interesting about United States Federal Debt.
- 1835 The last time the U.S. federal government was “debt-free.” That’s a LONG TIME to be in debt!
- Prison People used to go to PRISON for not repaying debts. It isn’t possible to put a government in prison.
- It’s been worse The U.S. was in more debt (as a % of GDP) at the end of World War II than it is right now. There’s hope!
- Zombie Debtor A British term for people who make “interest-only” payments.
- $52,203 Amount of debt owed by each U.S. citizen if the debt were split equally.
- $50,100 Average amount of debt currently owed by each U.S. citizen – including mortgage, credit cards, student loans, vehicles, etc.
Which one of these do you find most compelling/interesting?
The US National Debt has increased by $198,438,256,931 since our last update on November 11, 2012. Another two months, and the United States has dropped another cool $198 billion in the hole.
National Debt as of 1/14/2013
That is an increase of $3.101 BILLION PER DAY since our last update 64 days ago.
Our debt continues to spiral out of control like a person who is on a crazed spending spree. That NEVER turns out well!
I continue to stand by the following statements.
Whether we choose to address this problem as a nation or not, we WILL have to deal with it. We are really being faced with one of two decisions:
- Face the problem now by making some really tough choices Like reducing some great programs or potentially eliminating some of them. NONE of us like to reduce spending. It is NO FUN. It STINKS. But we all have faced this in our personal finances before. Of course, we want to let our children participate in any activity they enjoy, but sometimes we have to say NO because of the costs! Of course, many people would love to have a huge house with every amenity known to mankind, but sometimes it is just not possible to carry the financial burden required to maintain it!
- Let the problem fester until we are FORCED to make the tough choices Whenever I personally have let the clock run out on tough financial decisions, I have found that my options have been severely reduced and the pain is much greater. I’ve always found myself saying, “I wish I had made this decision sooner.” (NOTE: This is where Greece, Ireland, Spain, and several other countries are at this point. Decisions are being made that they no longer have full control of)
I wonder which decision the American citizens will make.