Magazine article U.S. Catholic

Spending like There's No Tomorrow: It's Time for Uncle Sam to Call a Credit Counselor

Magazine article U.S. Catholic

Spending like There's No Tomorrow: It's Time for Uncle Sam to Call a Credit Counselor

Article excerpt

APRIL IS THE CRUELEST MONTH, T.S. ELIOT FAMOUSLY wrote. I'm guessing Eliot penned that line just after Turbo-taxing his 1921 returns over to the IRS. As we endure what for most of us is a forlorn exercise in fiscal cartography this month, there is another budget we should also prepare to make a good account of--our nation's. This year Americans will cough up almost $2.8 trillion dollars in tax revenue to the federal government, and that spit-take inspiring figure will still not be enough to cover our government's daily debts.

Here's our fiscal wasteland: We are a culture and a government living on credit, spendthrifting away our grandchildren's future. The national debt now exceeds $8.2 trillion; annual deficits loom between $200 and $500 billion into the foreseeable future; personal debt likewise can be measured in hundreds of billions annually; and the current account deficit--the difference between what the United States imports and what it exports--now approaches $70 billion a month. America is adrift in an economic perfect storm of its own brewing.

Our house-of-cards-style financing wouldn't be so bad if it were at least producing investments in the nation's human capital--better education or universal health care--or improvements in its infrastructure or industrial capacity and competitiveness. But our deficits are funding a war without end, an insatiable Pentagon procurement schedule, and a relentless march of tax cuts for people who for the most part are already affluent.

Asian banks have been shoring up the U.S. economy for years, buying billions of federal debt in Treasury notes and personal debt in mortgage bonds. They are not likely to continue that policy indefinitely. Already China has announced plans to diversify its foreign currency reserves in what could be the first step away from the not-so-almighty, overvalued dollar. A dollar falling over the edge would almost certainly trigger a domestic economic collapse that would quickly escape America's borders. The world's poor, as they have in every other major economic disruption in the past, would certainly endure the worst of the suffering that would result.

Our collective inability as a nation and as consumers to balance our budgets is not just a political but a moral failure. …

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