We're taught early on: don't buy things you can't afford, but our Government didn't seem to pay attention. The official national debt is approaching $10 trillion. But that's not the whole story. The "real national debt," which includes both current liabilities and unfunded promises for entitlement programs, is $53 trillion. That's $175,000 of debt for each and every American.
$2.4 trillion of that $10 trillion national debt is in the hands of foreign governments, half of which is in the hands of just two countries: Japan and China. In the long term, this figure is expected to skyrocket and America could struggle to negotiate with its foreign creditors.
Finding buyers for American treasury bonds is usually considered a good thing, but China is a problematic creditor due to potential strategic conflicts. Sending a "sell" order that roils markets may not give China a veto over U.S. foreign policy, but it can increase the cost of any U.S. policy that China opposes.
As it stands, every American taxpayer's share of current foreign-owned debt is $19,750. Don't you think it's time Congress paid attention?
We're taught early on: don't buy things you can't afford, but our Government didn't seem to pay attention. The official national debt is approaching $10 trillion. But that's not the whole story. The "real national debt," which includes both current liabilities and unfunded promises for entitlement programs, is $53 trillion. That's $175,000 for each and every one of us.
Rising health care costs are outpacing overall economic and income growth and, absent dramatic and fundamental reforms, eventually could bankrupt the country. Based on our current entitlement and other spending, taxes would have to more than double over the next few decades in order for the government to pay its bills and deliver on its promises. What kind of example does that set for many Americans who struggle to save even a small amount?
Here is some food for thought: $2.4 trillion of the nearly $10 trillion national debt is in the hands of foreign governments. And about half of that foreign debt is in the hands of just two countries: Japan and China. In the long term, this figure is expected to skyrocket and America could struggle to negotiate with its foreign creditors.
Finding buyers for American treasury bonds is usually considered a good thing, but China is a problematic creditor due to potential strategic conflicts. Sending a "sell" order that roils markets may not give China a veto over U.S. foreign policy, but it can increase the cost of any U.S. policy that China opposes.
This is a complicated issue, but two things are clear:
* you want to be careful who you owe money to, and
* no matter how rich you are, borrowing on top of borrowing is not a great long-term financial plan.
As it stands, every American taxpayer's share of foreign-owned debt is $19,750. Don't you think it's time Congress paid attention?
