Deficit Spending


There are conflicting views, from the “experts” on the effects of Deficit Spending. For some it is very good for a country with as much economic power as the US, but for others it is a time bomb just waiting to go off. However, to me the bigger issue, which helps grow this deficit, is the political divide that our leaders have not only allowed but which they intentionally promote. A philosophy which takes hard earned money from our citizens and in essence wastes it, because promoting these political differences is more important to these “leaders” than actually supporting their employers, i.e., constituents.


Let’s start with the basics of deficit spending and then immediately shift to the root cause or main driver. Everyone knows that deficit spending is when we take in less money than we spend. Deficit spending has been around far longer than most people think. A common misconception is that it began just prior to World War II to get the country out of the great depression. However, this country has been spending more than it takes in since the revolutionary war. For that war, the cost on the country and the commitments we made to the allies we recruited, resulted in the US owing the French and the Dutch $70 Million. But the actual first official deficit budget creation was in September 1789, when Alexander Hamilton, then-Secretary of the Treasury, negotiated terms with the Bank of New York and the Bank of North America to borrow $19,608.81 to address shortfalls within the U.S. budget. ZERO ALERT…Let me caution you – the number of zero’s you are about to see may be offensive or objectionable to some people; From that original deficit point forward, the budget grew from roughly $20,000 to todays lofty $2,100,000,000,000…yes that’s $2.1 Trillion dollars, as of May 2021...that’s two point 1 with ELEVEN zeros!!!


$2.1 trillion dollars is an unfathomable number to most of us, but is it a problem. There are some really intelligent people, far smarter and better educated than I, who argue somewhat convincingly that more borrowing isn’t actually a problem and the country’s massive debt is nothing to worry about. They note that the U.S. economy is enormous and it can handle a hefty debt. They say interest rates are very low and we’re able to pay the interest to those we borrow from. They say debt is not yet crowding out funding for other programs. They say the ratio of debt to GDP has been higher at other times in history. They also say that the pandemic and resulting economic downturn demand a forceful response, even if it means higher debt.


I hope they’re right and perhaps they are. But, if they’re not right, we’re in trouble. And they are making some big bets. They’re betting that inflation will stay under control and interest rates will remain low. They’re betting that the economy will stay strong and generate more tax revenue. They’re betting that the citizens, foreigners and countries (including China) who purchase our bonds will continue to have faith in the U.S. financial system. For you conspiracy theorists, I have a thought for you that recently came to my often warped mind. 😊 China buys a great deal of our debt and thus profits when we issue bonds or borrow money. The spending incurred by this country to battle the Covid-19 pandemic increased significantly. According to the Washington Post, our country will spend $6 Trillion to battle the coronavirus. And where did the virus originate – yes China. Could this had been a carefully constructed plan, by the Chinese – I’m just saying???


Whether or not deficit spending is bad, the fact is that any time you increase debt, it has an impact which is, more times than not, a bad thing. So, because of deficit spending, we need to borrow money or issue bonds. We have to pay interest on this money, and all of this has to be captured in a budget. So quite frankly, the countries budget is absolutely critical in assuring our future financial stability. So, how well has our country done with the budgeting process? Not bad in the earlier years but since the late 1970’s, congresses performance has been dismal.


The government operates on a budget calendar that runs from October 1 through September 30. Each year, Congress must appropriate a specific amount of money to each department, agency, and program to provide funding for operations, personnel, equipment, and activities. Traditionally, the United States House of Representatives and the United States Senate agree together on a budget resolution in the spring that is then used to determine spending limits for twelve regular appropriations bills. The twelve appropriations bills, then appropriate the funding for the federal government to use for the next budgetary year.


Between fiscal year 1977 and fiscal year 2015, Congress only passed all twelve regular appropriations bills on time in four years - fiscal years 1977, 1989, 1995, and 1997. Between 1980 and 2013, there were eight government shutdowns in the United States.


There was a government shutdown that occurred in 1995. This was a standoff between Democratic President, Bill Clinton, and Congressional Republicans that led to the shutdown of the federal government. A budget was passed and then vetoed by the president. Without enough votes to override the veto, Newt Gingrich led the Republicans not to submit a revised budget. The resulting lack of appropriations led to the shutdown of non-essential functions of the federal government for 28 days due to lack of funds.


In 2013, Congress failed to agree on any regular appropriations bills prior to the start of fiscal year 2014. An attempt was made to pass the Continuing Appropriations Resolution, prior to October 1, but the House and Senate could not agree on its provisions, leading to the United States federal government shutdown of 2013. The shutdown of October 2013 involved a dispute over the continuing resolution in a standoff between Democratic President Barack Obama and Congressional Republicans led by House Speaker John Boehner. This led to a prolonged shutdown and furlough of more than 800,000 federal workers.


Today, as you likely have seen, President Joe Biden recommended another $6 trillion in spending, boosting the debt even higher. Biden is not planning to borrow the entire $6 trillion, of course. He wants to raise taxes on the wealthiest 1% of Americans to pay for some of it. The reality is that he won’t get nearly enough in higher taxes to pay for his new programs. Congress won’t raise taxes that much and, even if it did, big businesses and wealthy people will find ways to avoid the higher levies. So, taxes will go up some, but Biden’s programs, will mostly be financed by printing money and borrowing.


As you can see, the continual political divide, has led to a nation that cannot even agree on a basic budget. In fact, the only times budgets have actually been passed into law, are years when one party controlled all the votes in congress, the senate, and the white house. Democrats controlled in 1977, Democrats in 1989, Republicans in 1995, and Republicans in 1997. Today, every 4-6 months, congress has to meet to fund the government because there is no budget. They continue to kick the can down the road with continuing resolutions (CR) and then just as the money is running out, they desperately meet in hopes of passing another CR. All of this while the debt rises and we then need to borrow more money. At some point this has to end, so let’s hope it ends well and not catastrophic. However, this recent history of political ignorance doesn’t give one a high level of confidence.


Is deficit spending bad? The jury is still out but it does lead to more debt. Can congress ever get their act together and think of the total country first, instead of their own political aspirations and affiliations? Seems unlikely in our current environment. So, what can we citizens do to put this great country back on course???


In 1992 I took a bold action, at least for me, and broke from the political disease that’s spreading throughout this land, to support a businessman for President. Honestly, I did not think this candidate would win, but what I did think was that it would send a resounding message to congress that if this candidate pulled enough votes, it would clearly show them that the country was fed up with politics and wanted the country run as a business and by a businessman. That candidate was Ross Perot.


With his big ears and wacky southern drawl, Perot was laughed at, by many people, more than taken seriously. However, here was a genuine successful businessman willing to take on the Washington machine or the swamp, as it was better referred in later years. Perot was an American business magnate, billionaire, and philanthropist. He was the founder and chief executive officer of Electronic Data Systems and Perot Systems. He ran an independent presidential campaign in 1992 and a third-party campaign in 1996, establishing the Reform Party in the latter election. Although he failed to carry a single state in either election, both campaigns were among the strongest presidential showings by a third party or independent candidate in U.S. history. In the election, Perot received 18.9% of the popular vote, but did not win any electoral votes. However, he won over 19.7 million votes, far and away the most votes ever for a third-party candidate.


Unfortunately, as we have learned far too often, especially after the September 11th attacks, that congresses attention span does not last long – look shiny object. 😊 So, yes, this election result woke up the two mainstream political parties and they revamped their strategies, but they still did nothing to change their focus onto the people, versus their already established good-old boy and girl networks of political influence and wrangling. Making this decision to support Perot even worse, was the unintended consequence of taking true conservatives votes away from the wanna-be conservative party, which ended up putting Democrat Bill Clinton in office. On a personal note, like the president or not, I have always respected the office and the person in the office. Todays that is no longer true and that all started with Bill Clinton, so shame on me and the rest of the ~20 million who also voted for Perot. Our attempt to elect a businessman, pulled most of these votes from Republican candidate George H. W. Bush, and led to Clinton’s election.


My respect for the President was restored with George W. Bush and most recently with the first true businessman elected to the office since the 1700’s; Donald Trump. The difference being that this time one of the political powers endorsed this businessman and fortunately for our country, a true businessman was elected president. Trump tried in vain to run this country like a business. However, our touchy-feely world didn’t like the straight non-nonsense talk, and aggressive approach of President Trump and many of his party turned against him, likely afraid they would lose their silver spoon livelihood.


Our politics are getting in the way of our countries well being and we need to get true conservatives back to the polls. The republicans say they are conservative, and even though they are the closest to conservative of either major party, they are not true conservatives. They are far more moderate than most true conservatives like. The most recent poll on conservative-moderate-liberal American views found that 78.97% of those responding (Over 5 million people touching every state) stated they were conservative or at least conservative leaning. Yet nearly 30% (27.39) do not routinely vote because they have become so disillusioned with politics in our country. This is likely why the average turnout at the polls over this past 50 years is roughly 50-52%, which obviously means nearly 50% also DO NOT vote. Add these ~30% who say they are conservative but don’t vote to those numbers and the conservatives clearly win every election. Then we get a budget, and then we get some semblance of fiscal responsibility.


Whether or not deficit spending is bad, or whether or not we have a true budget, whether or not we keep paying interest on debts to our adversary’s, and whether or not our total debt eventually cripples our country, is up to all our citizens taking these challenges seriously and putting the people in office that will govern our country like a business. This may be a monumental task so, we need to seek God’s help as much and often as we can. We need to pray that he continues to help all of us as we endeavor to save our land. We need to put God first, and live for God in all that we do. But we will need his help to assist us in bettering our country.


GOD BLESS AMERICA…and…God Help us Help America!!!!!!!!!



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