A Debt The Founders Wouldn’t Believe
By SEN. JUDD GREGG | Posted Friday, June 26, 2009 4:20 PM PT
In a 1789 letter to James Madison, Thomas Jefferson wrote: “The earth belongs to each of these generations, during its course, fully, and in their own right. The 2d. generation receives it clear of the debts and encumbrances of the 1st. The 3d of the 2d. and so on. For if the 1st. could charge it with a debt, then the earth would belong to the dead and not the living generation. Then no generation can contract debts greater than may be paid during the course of its own existence.”
What would Thomas Jefferson think today, as the Obama administration puts this generation on a path to drive the debt sky-high, effectively leaving our children and grandchildren to foot the bill?
Over the past 40 years, U.S. debt has averaged 36% of our gross domestic product. Because of the current economic downturn and the fact that the government has had to serve as a lender of last resort to stabilize the financial system, we are seeing what should be only a short-term spike in our debt levels. By the end of this fiscal year, our publicly-held debt will be about 57% of GDP.
By the end of the budget period as proposed by the president, the debt will have skyrocketed to 82% of GDP, which is simply not sustainable.
Interest payments on that debt will soon be the largest single item in the federal budget — more than $800 billion per year in 10 years’ time.
That will eclipse what we will spend on national security, and is four times as much as we will spend on education, energy and transportation combined.
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