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At This Current Pace, A Record-Shattering 2.4 Trillion Dollars Will Be Added To The National Debt This Year

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america-is-brokeBarack Obama is about to become the 20 trillion dollar man. With less than two months to go in his second term, the U.S. national debt stands less than 150 billion dollars away from the 20 trillion dollar mark. And at the pace that the debt is increasing, it seems almost certain that we will cross 20 trillion dollars before Inauguration Day. After promising us that “deficits are under control”, the federal debt jumped by more than 1.3 trillion dollars last fiscal year, and so far this year it is on pace to rise by a record-shattering 2.4 trillion dollars. This is a recipe for national suicide, and yet it wasn’t even a major issue during the recently concluded presidential campaign.

It is really, really hard to spend a trillion dollars. For example, if you were alive when Jesus was born and you had spent a million dollars every single day since that time, you still would not have spent a trillion dollars by now.

And even though the Republicans have had control of the House of Representatives since 2010, the wild spending has not slowed down one bit. In fact, it is actually accelerating as we near the end of Obama’s second term. Last year’s rise in the debt of more than 1.3 trillion dollars was shocking enough, but this year we are on pace to top that number by more than a trillion dollars. The following comes from Simon Black

According to data released by the Treasury Department yesterday, the US national debt has soared by a whopping $294 billion since the start of the 2017 fiscal year, just 45 days ago.

That’s an annualized increase of 13%.

So if they keep up this pace, the national debt will increase by $2.4 trillion this fiscal year, surpassing $21 trillion by next September.

The only reason we have been able to go on this debt binge for as long as we have is because the rest of the world has been willing to loan us trillions upon trillions of dollars at ridiculously low interest rates that are well below the real rate of inflation.

This is a highly irrational state of affairs, and once this changes we are going to be in a massive amount of trouble.

And since Donald Trump’s election victory, we have already seen the rate on 10 year U.S. Treasury notes shoot up dramatically.

Over the long-term, the average rate of interest paid on U.S. government debt has been about 6 percent. Right now we are way below that, but that cannot last forever.

At some point rates will rise, and if we were to just get back to the 5 percent mark we would be paying more than a trillion dollars a year just in interest on the national debt once the debt hits $21 trillion.

The bottom line is that we are racing toward national bankruptcy.

But instead of focusing on getting the debt under control, Donald Trump is already promising a whole bunch of new spending in addition to what is already taking place.

This week, Federal Reserve Board Chair Janet Yellen warned Congress about what Trump’s $1 trillion infrastructure spending program may mean for our financial situation…

President-elect Donald Trump has pledged a $1 trillion infrastructure spending program to help jump-start an economy that he said during the campaign was in terrible shape.

Speaking on Capitol Hill Thursday, Federal Reserve Board Chair Janet Yellen warned lawmakers that as they consider such spending, they should keep an eye on the national debt. Yellen also said that while the economy needed a big boost with fiscal stimulus after the financial crisis, that’s not the case now.

“The economy is operating relatively close to full employment at this point,” she said, “so in contrast to where the economy was after the financial crisis when a large demand boost was needed to lower unemployment, we’re no longer in that state.”

The truth is that we simply can’t afford to keep going into so much debt.

Debt literally destroys the future, and since Barack Obama has been in the White House our government has been stealing more than 100 million dollars an hour from our children and our grandchildren every single hour of every single day. It is a crime of such a magnitude that I don’t know if there are words to describe it, and yet only a very small fraction of the population is upset about this right now.

We have just come to accept that ripping off our children and our grandchildren is normal. But someday if they get the chance they will curse us for what we have done to them.

In our extreme arrogance, we actually think that it is okay to saddle them with a giant mountain of debt that they will be servicing for their entire lives. In a just society, those that have done this to future generations of Americans would be going to prison.

When you go into debt, you take consumption from the future and bring it into the present. In essence, we are taking money that they should have been able to spend, and instead we are spending it right now.

Without a doubt, government spending helps the economy in the short-term. When the government spends money, it gets into the pockets of ordinary Americans who in turn spend that money on goods and services that they need. So that is why politicians like to borrow and spend – it makes the economy perform better than it otherwise would, and voters tend to vote for incumbents when “things are going well”.

If the federal government had only spent the money that it took in through taxes over the past eight years, we would be in a rip-roaring depression right now. Barack Obama and those that work under him understand this, and that is why they were perfectly fine with running the national debt up to 20 trillion dollars. They will take credit for “fixing the economy”, but the truth is that all they did was steal trillions of dollars from our kids and our grandkids.

And anyone that has ever gotten into trouble with debt knows that a day of reckoning comes eventually.

Could our day of reckoning be just around the corner during the Trump years?

Donald Trump will be blamed if everything crashes while he is in office, but the real blame should be placed at the feet of Barack Obama, George W. Bush, Bill Clinton and a deeply corrupt Congress that always went along with the wild spending.

About the author: Michael Snyder is the founder and publisher of The Economic Collapse Blog and The Most Important News. Michael’s controversial new book about Bible prophecy entitled “The Rapture Verdict” is available in paperback and for the Kindle on Amazon.com.

  • Reader

    Trump should just cancel all US government debt. Cold turkey.

    • Guest

      How?

    • Oh, you mean doin’ what he does best — filing bankruptcy and defraudin’ people who put trust in him?

      Please don’t normalize his deceitful actions. This nation needed to heal after eight years of Obama’s actions, and we somehow let the developmentally-disabled people win the electoral college, thus taking our nation out of the frying pan and dropping us straight into the fire.

      “Canceling debt” is just the POS way of saying “filing bankruptcy”.

      • ALWAYSTOMORROW

        You do realize filing bankruptcy is perfectly legal!?

      • MEP325

        I’m sure corrupt Hillary would’ve helped the country heal had she been elected.

        • Lazarovic

          Yes. Everyone would have healed, except the fanatics, traitors, Benedict Arnolds, racists and bigots of the right wing. They would have started an armed rebellion, and U.S. Army Apache helicopters would be gunning them down right now! Urrah!

          • MEP325

            Riiiggght…… Hillary is such a loving, caring, selfless person and she would have made such a wonderful president. She would’ve showered the country with her love and charm.

  • Scot Wm

    The hyperinflation experienced by Germany’s Weimar Republic in 1923 shows what will eventually happen to the US economy. The United States uses fiat currency, which is backed by nothing but it’s citizen’s faith in their government. Unlike it’s citizens, the US government has the ability to print the money needed to pay its bills. However, diluting the money supply with more fake money causes more inflation. Soon, prices rise uncontrollably as more and more fiat currency is needed to purchase food, shelter and other necessities. The collapse of the German economy cleared the way for international bankers to finance facist dictator Adolf Hitler’s death squads and World War II. The reality is that all fiat currency eventually inflates itself out of existence. It remains to be seen how the international bankers will react to the collapse of the US economy.

  • robert

    Until entitlement programs are cut severely, there is no hope of dealing with the debt. There is almost no wiggle room with the annual national budget. Want to see an uprising? Cut SS and Medicare big time. Ryan thinks he is going to get a Medicare voucher system. If he tries that, the GOP will never win another election–ever.

  • seekless

    No one is going to blame Bush, so go back to the left wing kook sites.

    • Lazarovic

      I blame Bush, and the fools that voted for him. Everything was good until he got elected. Endless wars, spending, and economic collapse. Stupid Republicans. You know I’m right.

  • “Donald Trump will be blamed if everything crashes while he is in office”
    And that is a shame, because the blame should lay firmly at the feet of the low-information voters who allowed the Trump-travesty to befall America.

    Electing someone who has filed bankruptcy EVEN ONCE would have been the dictionary definition of foolish; electing someone who’s failed/filed as many times as he has is just too phenomenally stupid to believe sometimes.

    Anyone who hasn’t seen the “comedy” film “Idiocracy” should definitely see it soon if you wish to know what our failure of a President is going to usher in. It stars Terry Crews, a great Mormon actor. (Can’t be many of those in Hollywood, right?)

    Obama handily stole the title of “Worst President” from G.W. Bush, and the impatient Don the Con has already started grasping hysterically at the title. I hope the country is still here in 2020. I’m aching to see if we can reverse the course and actually elect someone oh, I dunno… COMPETENT, for a change?

    • ALWAYSTOMORROW

      America is bankrupt. We need someone with experience.
      Wise choice I’d say.

      Hillary never took any risks. All her money,hundreds of millions, came from BRIBES. I’m glad she slithered back under a rock :-)

  • Pete Okuhira
  • shotscauseautism

    Collapse is a catch-22. If there is no collapse Americans keep expanding until no wilderness left! I love wilderness more than almost anything so part of me is happy the collapse is coming. However life will be tough in a barter trade system so I don’t really want the dollar to end.

  • DJohn1

    The problem is debt is a tiger by the tail. The minute you release that tiger it is going to come back and destroy you.
    The main losers in this battle of debt are going to be anyone on a fixed income without the ability to increase that income.
    I include myself in this group. We are on Social Security with fixed pensions. We are fortunate in that we both worked most of our lives and at the same place so we did get good pensions and union wages.
    Most people in today’s world get 401Ks instead of pensions.
    Since about 1980, this world has been going against the common person out there and wages and pensions have not even began to keep up with things.
    People that own our corporate economy understand this. Hyperinflation under Donald Trump’s plan will occur. The result will be a disaster because the very people that profit from this plan will be the ones that go bankrupt.
    The delicate balance is the cost of material goods produced by low-cost labor abroad. This cost is not realistic. Has never been realistic. But the basis of it was to feed millions of people that would have otherwise had no choice but to go to war or starve. That was in 1970 under Nixon.
    There is an old oriental proverb. It says that “Those that feed China rule.”
    All other considerations in China are meaningless.
    What China has to have is a delicate balance between feeding and employing their massive population and keeping their host alive.
    Their host is the rest of the world. The obvious host is not the United States. It is the USSR which happens to be right next door.
    At this point in time, transportation costs and automation of products is quickly making the Chinese economy obsolete. With Robotics and new tooling methods such as the 3-d printing method of producing new tools to put industry together, retail goods can be produced cheaper here than they are produced by Chinese and Indian labor abroad.
    So what happens next? Obviously the Russians and Chinese are preparing. Possibly for war. That is the obvious truth. They are willing and able to spend millions of lives to keep in power. Without food, they have no choice.
    We do have choices. One solution is the reduction in hours of the workforce to produce an economy where almost everyone that wants a job can have one. Mr. Franklin Roosevelt tried this with some success.
    In the 30s. We went from a 48 hour 6 day week down to a 40 hour week with everything over 40 hours considered time and one half wages.
    It worked but it took a lot of time and a world war to bring us totally out of the depression of the 30s.
    We went to national unions to increase wages.
    This was offset by a national inflation rate of approximately 4.5% per year. What it did do is increase the number of people paying income tax and gave the government a lot of economic power.
    That national unions was a poor man’s way of increasing gradually the national standard of living. The main winners of that were the corporations. With an increase in wages, they were able to make huge profits on the masses.
    To bring all of that back, we have to reverse the trend of corporate greed to the point that they make a healthy profit but are not draining the economy of ready funds for the masses.
    This is so complicated and economic change that I doubt if any one person can accomplish it in 4-8 years. But that is what must happen if we are to avoid a currency collapse.