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ETpro's avatar

How much do you really understand about the US National Debt and current deficits?

Asked by ETpro (34436points) October 30th, 2012

Listen to this 6 minute video explanation of our current debt, who actually holds it, and what it all means. If you’ve been swayed by political rhetoric using the debt as something more frightening than 16 trillion Freddy Kruegers, you will probably learn not to listen too closely to political polemics and you’ll gain a better grasp of the reality of our debt and how we might best handle it. Not understanding the true nature of our debt might lead us to embrace disastrous policies like the Luddites that now control the Tea Party are advocating, so it behooves us to understand it.

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6 Answers

Coloma's avatar

Very little, but I understand my own debt and deficits well. haha
I think very few of us can even wrap our mind around the trillions of dollars spoken of. It is really beyond comprehension. The US debt is just a mysterious number tossed about by the equally mysterious powers that be IMO. It just doesn’t compute with the average citizen who is more concerned with filling their propane tank for winter and putting new tires on their car, like me. :-)

wonderingwhy's avatar

I think it’s a little more serious than he states but, yeah, his explanation is pretty in line with my understanding and certainly more concise than I could’ve expressed it. I’d also add it’s all about confidence based on a lot of appearance and perception.

I think I’m a little more concerned about it because we’re moving more into a global economy without a clearly defined (to my understanding) place or vision. The BRIC nations – particularly China – are a more significant threat to knock us back to “average” than we’ve had in a while. With Europe shaky and Asia unclear the markets are even more sensitive to US shocks. And, our internal divisions are greater, seemingly more clouded, and become more of a threat to sustainable progress as time goes on.

But, even with all that, as was stated in the video, it’s hardly a crisis and doesn’t need to be acted on as though it were, however it could become one without structured intervention and stable, predictable, planning.

YARNLADY's avatar

I was just looking at the latest version of the Treasury Department debt pie chart and I was not the least bit surprised to find that nearly 70% of the National Debt is owed to US, that’s right, our fellow United States Citizens.

Everyone who buys bonds or other government backed funds is a holder or the National Debt. Anyone who is on Social Security or a potential Social Security recipient, anyone who receives Military Benefits is a holder of the National Debt.

wundayatta's avatar

I think there are a lot of people out there who think the debt is a horrible problem, and who can not see otherwise, because the debt is also a political issue.

So, nice try. But I doubt it’ll reach the people who need to understand this.

GracieT's avatar

@wundayatta, it usually doesn’t reach them. I’m surrounded by people who all ignore reality and common sense, and still want Romney as president. I’m getting so discouraged with how close things are getting.

ETpro's avatar

@Coloma You really should listen to the video. It;s just 6 minutes long, and is on a level I am certain you can grok.

@wonderingwhy I would be completely unconcerned with it if we weren’t so politically divided. My fear is that the only actions likely due to the inane con vs. lib mentality that’s so prevalent now is that we repeatedly shoot ourselves in the economic foot till we are limping so badly that interest on our future debt skyrockets and triggers a great depression even the Fed and Wall Street combined can’t buy our way out of.

@YARNLADY Yep. The good news is most of the US National debt is just coming out of one of our pockets and going straight back into another. And for every dollar of US debt held by foreign nationals, we hold $0.89 of foreign debt.

@wundayatta There is nothing like reality crashing down on an airhead to jerk them out of fantasy land and bring them crashing back into the world where reality rules.

@GracieT Take heart, dear. There are NEVER any dropouts allowed in the school of hard knocks, and the school is open all year every year.

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