President Biden stopped by Pittsburgh last week to unveil his American Jobs Plan. He hopes that his $2.25 trillion vision will be able to create millions of jobs while rebuilding America's aging infrastructure. We can all hope for that.
It is the largest bill ever dreamed of. In fact, the President admitted that the plan is actually only the first game of a double-header. The second part, The American Family Plan, will be unveiled 'in a few weeks' and is expected to sniff the $2 trillion mark, as well.
Support in Washington has been mixed. The Right claims that only 25% of the American Jobs Plan actually goes towards infrastructure. Some on the Left say it is not enough because then-Candidate Biden promised $7 trillion for a similar effort. Add the recently passed $1.9 Trillion Covid relief package (American Rescue Plan) and President Biden could come in with a cool $6.15 Trillion in spending around the 100 day mark, if they all pass. He says much of the spending would be paid for through various tax increases.
The national debt rose by about $7.8 trillion under President Trump. About $3.9 trillion of that was COVID-related. President Obama added about $8.6 trillion during his tenure. President George W. Bush added $6.1 trillion. We are closing in on $29 Trillion now. That is 129% of GDP. 129% of what we, as a nation, make in a year. Trying paying that off with the monthly minimum payment.
I wrote an op-ed last July about the pit of oblivion known as our national debt crisis. It was titled 'Another Bailout or Not; You Are Screwed.' I'm sorry. I should not call it a 'crisis.' DC-types hate that term unless it is used to their political benefit while ginning up the emotions of a lemming-like electorate or allies in the '4th estate.'
No one seems to care. Read my last op-ed about debt here.
Yes. We need to improve our infrastructure. There is no question that we have fallen way behind other nations. We are living in a crumbling land. And, had we not violated the intent of various taxes then maybe we would have some rainy day funds available to help the cause. But, no! We sat idly by while our leaders abused any and all cookie jars. They redistributed your money to offer political favors and vanity programs that are outside of Federal responsibilities. And you loved it. So did Corporate America. Everybody got something for 'free.' The story of over-spending is not sexy enough to illicit a peep from Coca-Cola, Delta, Home Depot, Major League Baseball, etc in the way other stories are - whether those stories are based in fact or fiction.
A debt crisis or spending problem is not as emotional as dropping 3 & 5-year olds over a fence, either. (oh, sorry. The media, corporate America, and DC are ignoring that story for now.) Actually, it is not the media's fault. The Biden Administration has blocked them from covering the border cris….er….surg….nope….uh….'situation.' And, still not a peep about 'freedom of the press' either.
OK. Back to my point: A little debt is good, right? We are the richest country on the planet, right? Right? Right? Hmmm. OK-yeah-but-how-bout-we-like-totally-ignore Qatar, Luxembourg, Switzerland, Norway, Kuwait, UAE, Ireland, and some others, Okay? Okay.
Every single person residing in the US - regardless of whether or not they have gleaming personal finances - owes at least $85 grand thanks to your elected leaders in Washington. Yes. $85,000 whether or not it is your last day on this planet or your first. Whether you have a job or not. The number jumps to an average of $225,000 each when spread out only among American adults with jobs (taxpayers.) Congratulations. Your birthright here in the US of A is DEBT. You must work for those you owe - in this case: Uncle Sam. Well, actually, Sam just makes sure the bags of money get to the bosses in Beijing, Tokyo, London, Dublin, etc.
It is awful and embarrassing and it all trickles back down to YOU. You will pay it one way or another. Whether in the form of taxes, hidden costs, higher prices, lower standards of living, or inflation. YOU. WILL. PAY.
As large holders of US Treasuries - China, Japan, UK, Ireland basically fund the American federal budget deficits & debt. They are our credit cards. We pay them interest. You owe more on those cards than you make in a year.
China, for example, also generously offers credit to many other nations around the globe to the tune of nearly $6 Trillion. China is growing and lending a lot of money internationally through its 'Belt and Road Initiative' which funds infrastructure projects to weaker, poorer countries. (Wait, they fund our projects too, right? Are you implying? Noooo.) It is not just loans or money. China is capitalizing on 'the virus' as a way to lean on the third world. It is using supplies of its covid vaccines to poor countries as a way to make them choose between us or them.
These are major steps in Beijing's attempt to make its 'yuan' a global currency, similar to the US Dollar. At the same time, the world's largest economy and biggest exporter, China, takes advantage of its 'developing country' status to receive favorable loans from the World Bank.
If China is successful at weaving its economy and currency web around the globe then it could begin to sell off its T-bills or call in its US debt which would cause serious issues for our economy, our dollar, and YOU.
Imagine if we repeat the 1980's with a few key changes. What if China (not USA) is believed to be building its military prowess and the USA (not Russia) must spend cash to meet that perceived threat but our economy gets sluggish and our workers are not incentivized to work? Then what? We don't have enough money to find out. We are too far in debt.
Kevin Battle is not an economist. He is currently in a home/yard improvement spending war with his neighbors. Battle is the co-host of the KDKA Radio Morning Show with Larry Richert. The show airs 5a-9a M-F on Pittsburgh's 100.1FM and AM1020 or the Audacy app.
