The real-time graphic of the U.S. Debt Clock going higher and higher is familiar to many. Where is the money going? Is a U.S. economic collapse coming?
A trillion dollars is beyond the grasp of ordinary people. What is a trillion dollars? A trillion dollars equals $1,000,000,000,000. That’s a 1 with 12 zeroes to the left of the decimal point. A trillion is a million millions.
In February 2022 the U.S. debt reached $30 trillion! (Only 20 months earlier, in April 2020, the debt was less than $25 trillion.) U.S. Debt Clock.org estimated that each U.S. citizen’s share of the debt was about $90,000! How did one of the wealthiest nations in modern history become so indebted?
Some of the largest areas of regular U.S. expenditures include Medicare/Medicaid, Social Security, defense/wars, net interest on the debt and federal pensions. Add to that the extraordinary items, such as the federal government’s massive 2020 coronavirus response.
Debt comes when we spend more than we earn. Many who go into debt do so with the hope that future earnings will make it possible to pay the deficit. There is a great deal of wealth in America; but increasingly, the wealthiest seem to get richer while many people slip below the poverty line each year.
The U.S. Census Bureau reported that 11.8 percent of the U.S. population lived below the poverty level in 2018. And that was before the 2020 coronavirus crisis impacted the economy.
U.S. public debt
When you don’t have enough money to pay your bills, you must borrow it. This is also true for the United States when obligations have to be met. Government debt is often held by the public in the form of Treasury securities, which are owned by individuals, corporations, the Federal Reserve System, local governments and foreign nations.
Local, state and federal governments largely raise money through taxes, borrowing and selling securities.
So where does the U.S. stand in terms of its debt?
History.com gives this overview of the U.S. national debt from the time of the Great Depression:
“The national debt again jumped dramatically as the economy tanked and the size, scope and role of government expanded during the Great Depression and the New Deal.
“Then came World War II, when the debt-to-GDP ratio would rise above 77 percent for the first time in the nation’s history, reaching 113 percent (an all-time record) by the end of that conflict.
“In the post-war years, the national debt shrank in comparison to the booming post-war economy, which saw high GDP growth. The debt-to-GDP ratio went as low as 24 percent in 1974.
“Recession and rising interest rates soon caused it to swing upwards again, as did the huge permanent tax cuts during Ronald Reagan’s first term and increased spending on both defense and social programs, and by the early 1990s, the debt-to-GDP ratio had reached nearly 50 percent.
America has on its currency “In God We Trust.” Has this become an empty phrase?“Economic growth in the late ’90s, combined with tax increases under both Presidents George H.W. Bush and Bill Clinton helped bring the debt load back in line, and by 2001 the national debt was less than 33 percent of GDP.
“But that would soon change, thanks to increased military spending after the terrorist attacks of 9/11, tax cuts under George W. Bush, and the arrival of the Great Recession, when GDP fell rapidly and business activity and tax revenues shrank. …
“Despite the nation’s economic recovery, and the end of the wars in Afghanistan and Iraq, the U.S. debt-to-GDP ratio has remained above 100 percent since 2013. During fiscal year 2017, the total national debt passed $20 trillion for the first time in the nation’s history. Debt levels continue to rise. …
“The COVID-19 epidemic is impacting national debts across the globe. The Congressional Budget Office projects a federal deficit of $1 trillion in 2020. An economic stimulus package from congress could prompt the U.S. national debt to surpass $25 trillion or higher.”
America, once known as one of the richest nations in history, has become a debtor nation. Even though most of the debt is owned by Americans, U.S. debt has increased dramatically in recent years. It wasn’t too many years ago, during the presidency of Bill Clinton, that the United States had a surplus.
Many factors in a free economy can challenge the effectiveness of its financial system. Greed and dishonesty by major companies have taken their toll. Financial scandals have undermined public trust.
Financial curses prophesied
America has on its currency “In God We Trust.” Has this become an empty phrase?
The United States of America has historically been a Christian-professing nation founded on Christian principles that include hard work, reverence for a Creator God and a desire to help others in need. While other nations possessed great national wealth, the spirit of enterprise and opportunity certainly propelled this young nation toward hope and prosperity.
In the Bible the ancient nation of Israel began with blessings from God. Its citizens asked, “For what great nation is there that has God so near to it, as the LORD our God is to us, for whatever reason we may call upon Him?” (Deuteronomy 4:7).
Financial blessings for obedience
If a nation worships God in spirit and truth, God promises many blessings. Notice what God told the ancient Israelites.
“And all these blessings shall come upon you and overtake you, because you obey the voice of the LORD your God:
“Blessed shall you be in the city, and blessed shall you be in the country. Blessed shall be the fruit of your body, the produce of your ground and the increase of your herds, the increase of your cattle and the offspring of your flocks. Blessed shall be your basket and your kneading bowl.
“Blessed shall you be when you come in, and blessed shall you be when you go out. The LORD will cause your enemies who rise against you to be defeated before your face; they shall come out against you one way and flee before you seven ways.
“The LORD will command the blessing on you in your storehouses and in all to which you set your hand, and He will bless you in the land which the LORD your God is giving you. The LORD will establish you as a holy people to Himself, just as He has sworn to you, if you keep the commandments of the LORD your God and walk in His ways” (Deuteronomy 28:2-9).
Continuing to explain the blessings for obedience, God said, “The LORD will open to you His good treasure, the heavens, to give the rain to your land in its season, and to bless all the work of your hand. You shall lend to many nations, but you shall not borrow” (verse 12).
As for the status of those who must borrow, the Bible is clear: “The borrower is servant to the lender” (Proverbs 22:7, emphasis added).
U.S. debt crisis?
The staggering amount of national and personal debt could have serious repercussions, including a depression. If America does not pay its debts, difficult economic times could come for millions of people, especially those who depend on entitlements from the government.
Wealthy civilizations that were known for their military power and influence have collapsed in the past. Will America join the list of ancient civilizations that lie in ruin?
Incurring debt and not repaying it is a mark against the character of an individual as well as a nation. No family or nation can afford to live beyond its means indefinitely. The laws of economics, as well as the laws of God, show that default brings pain on all. God wants mankind to prosper (3 John 1:2), but God will not bless a family or nation that refuses to honor Him and pay its bills.
Is it possible that a great nation with fantastic resources could end in financial ruin? Will a financial crisis bring about a U.S. economic collapse? The future is unclear as to exactly what will happen in the years ahead. But it is sure that if Americans forsake their God and seek their own way, the blessings that have sustained us for decades will surely fade away.
Because of sin, the Bible predicts a time of great trial for the descendants of the ancient Israelites and the whole world (Jeremiah 30:7; Mark 13:19). The United States needs to honor God and pay its bills if it wants to be blessed.