First, the problem is rooted in flawed economic and political policies on the one hand and an apathetic citizenry on the other. Second, the magnitude of the problem needs individual and collective action on the part of citizens and courageous action by government. The former starts with awareness while the latter is achieved through people’s organized efforts in pushing government into making the right decisions. Third, there is a need to develop a culture of earning through hard work and disciplined spending from all sectors of society with an emphasis not only on fulfilling present needs, but also saving and investing for the future. The necessary change represents a very difficult and total overhaul but it is possible.
To deal with economy at a standstill, President Obama implemented a stimulus plan that encourages domestic spending. To address the deficits, he campaigned for decreased government spending in health care, namely Medicaid and Medicare, which form the bulk of current and projected spending. To address indebtedness and dependence on foreign loans and goods, he envisioned programs which would allow the U.S. to stand on its own. For example, a large proportion of debts are from oil-producing countries whose oil exports are the major source of America’s energy. By developing alternative energy sources, there would be less dependence on oil imports and more domestic production. However, the problems persist. Deficits continue because full political support for decreased government spending is lacking while the demand for health care entitlements continues to increase with baby boomers reaching eligibility. At the same time, programs to increase economic independence themselves require funding and with a budget deficit, the only option is increased borrowing. The only way out, it seems, is to continue to campaign for political support for reforms while borrowing foreign money to develop a sustainable economy and then paying for the debt afterwards.
The amount of our credit or foreign loans today far exceeds our domestic earnings. It means we have spent way beyond our capacity to pay. One figure that is alarming is the amount of spending on defense and wars. While it is just for the government to spend on benefits and entitlements because these are helpful to citizens, I do not think that engaging in and sustaining various wars abroad or policing the world is warranted at a point in time where domestic economic problems seem impossible to solve. With limited financial resources at the moment and indebtedness, defense and wars exacerbate the situation. The government has to set its priorities.
I belong to a middle class family with a current paycheck that allows me and my family to get by, but with a standard of living that is lower than what we would have wanted. The national debt threatens to decrease our current standard of living further, with a future projected to be worse as the consequence of the continuously accumulating debt. The debt is born by current as well as the next generations in a context where the economy is on the brink of collapse. The middle class is the hardest hit because their financial resources are limited to allow them to cope with tax increases and less entitlements including social security. This means that while the years of my economic productivity would prove difficult, retirement would be a greater challenge. My children, grandchildren and I will need to make the necessary sacrifices hoping that one day a generation will come to existence with no debts to pay.
If changes at the national and individual levels do not happen fast enough, the debt will continue to balloon without hope of ever rising above the problem. If it comes to a point that debts are too much and foreign countries stop loaning the U.S. money as well as start getting their money back, federal programs will eventually shut down. Taxes will rise as the only source of government funds. With an economic crash, the value of U.S. dollar will plummet. The president should have the political will to decrease spending on programs that do not benefit the average American such as wars. There is a need to decrease imports by stimulating sufficient domestic production of goods which will generate jobs and increase income. It will allow people to cope with lower government spending without falling into poverty.