Download the national debt

What is the National Debt?
 The United States government usually
spends (expenditures) more than it makes
(revenue) every year. This is known as
deficit spending.
 Continual deficit spending over the years
has led to a debt we owe.
 Who do we owe? Who did we borrow from?
53% to ourselves; 47% to foreign investors
U.S. CONSTITUTION
ARTICLE 1 SECTION. 8. The Congress shall have
Power To lay and collect Taxes, Duties, Imposts and
Excises, to pay the Debts and provide for the common
Defence and general Welfare of the United States; but
all Duties, Imposts and Excises shall be uniform
throughout the United States;
To borrow Money on the credit of the United
States;
The
th
14
Amendment
SECTION. 4. The validity of the public debt of the
United States, authorized by law, including debts incurred
for payment of pensions and bounties for services in
suppressing insurrection or rebellion, shall not be
questioned. But neither the United States nor any State
shall assume or pay any debt or obligation incurred in aid
of insurrection or rebellion against the United States, or
any claim for the loss or emancipation of any slave; but all
such debts, obligations and claims shall be held illegal and
void.
QUOTES FROM THE FRAMERS
 “I sincerely believe that banking institutions are more
dangerous than standing armies; and that the principle of
spending money to be paid by posterity... is but swindling
futurity on a large scale.” Thomas Jefferson
 “I place economy among the first and most important of
virtues, and public debt as the greatest of dangers to be feared.”
“To preserve our independence we must not let our leaders load
us with perpetual debt. ….If we can prevent the government
from wasting the labours of the people under the pretence of
caring for them, we will be wise.”
Thomas Jefferson
More Quotes
 "No pecuniary consideration is more urgent, than the regular
redemption and discharge of the public debt: on none can delay be
more injurious, or an economy of time more valuable.” George
Washington
 “Allow a government to decline paying its debts and you overthrow
all public morality--you unhinge all the principles that preserve the
limits of free constitutions. Nothing can more affect national
prosperity than a constant and systematic attention to extinguish the
present debt and to avoid as much as possibly the incurring of any
new debt.” Alexander Hamilton
 "There are two ways to enslave a nation. One is by the sword. The
other is by debt.” John Adams
History of the National Debt
 The first national debt was the result of the American
Revolution and the weakness of the Articles of
Confederation
 The first yearly reported debt was reported in 1791$75,463,476.52
 Andrew Jackson (1829-1837) was the first President to
remove the national debt
 (There was a depression in 1837 when his successor- Van
Buren- took over)
More History
 The National Debt grew tremendously as a result of these
events:
Civil War- 1863= first time $1 billion
WWI- 1918= $25.5 billion
Depression/“New Deal”- 1936= $33.7 billion
WWII- 1943= $201 billion
**Over the years some Presidents have removed all the debt
and some have reduced it.
Modern History
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1981- $997 billion
1982- first time $1 trillion (what is a trillion?)
1996-2001 - stayed in the $5 trillion area
It has climbed steadily ever since:
2006- $8.2 trillion
2007- $8.8 trillion
2008- $9.3 trillion
2009- $11.1 trillion
2010- $12.8 trillion
2011- $14.5 trillion
Interesting Facts
 Remember deficit spending?
 2000 was the last year we actually had a budget surplus-
$230 billion
 2009- we were $1.4 trillion over budget
 Summer of 2011- political fight over raising the debt ceiling
 These Presidents added/are adding these amounts to the
National Debt:
Clinton- $547 million per day
Bush (W.)- $1.6 billion per day
Obama- $4.1 billion per day
The Worst Part?
 Almost 10% of our yearly U.S. Budget is used to
pay off interest (alone) on the debt (that is 10
cents out of every budget dollar)
 How do we stop this? Spend less? Tax more?
No wars?
 Can our government keep doing this? Is this
spending scenario- sustainable?
 The 10 year projection for our national debt (if
the situation doesn’t change)- $23 trillion
 Who will end up bearing the burden?