by: Jennifer Huang
The issue of the rising debt has been plaguing America since the onset of 1990s: U.S. debt now totals $19.9 trillion, a startling figure that is equal to 432% of annual GDP. Recent statistics have shown that “$8.3 trillion in liabilities… are not accounted for in the publicly held national debt”. Medicare are Social Security funds are running a startling $76.4 trillion short of promised amounts; this shortfall equates to 90% of all assets in America.
The brunt of the debt, however, is felt by the young generation. With such high expenditures on interest payments, increasing amounts of money are being cut from investment on infrastructure and education, which are two crucial factors of long-term growth. Even more threatening is the fact that interest payments on the debt are almost certain to increase: With the baby boomer generation on the verge of retirement, Social Security and Medicare payments will continue to increase.
Yet, Washington, which controls and determines the level of debt, has done nothing in face of impending doom. Politicians serve at the pleasure of their constituents, and constituents serve at the pleasure of themselves. Baby boomers, as the largest group that will ever benefit from entitlements, are also the age cohort with the most political power. Notorious as the most "entitled" generation in American history, baby boomers have either unknowingly or willingly neglected the growth of future generations in favor of their immediate comfort. Their monopoly in Washington bounds politicians as their puppets; no politician wants to get elected out of office for defying the baby boomer monopoly. As a result, Washington has implemented tax cuts and spending increases to increase popularity amongst constituents, rather than exercising fiscal caution: The result is an even faster growth of debt; coupled with persistent entitlements and a culture of instant gratification, it's unlikely that America will ever reverse its path to economic doom.
Like most difficult issues, there is no “quick fix.” The young generation currently holds minimal political power – many of us are not old enough to vote – yet we can take small steps to resolve these issues. Perhaps the greatest tool at our disposal is education, and we can harness its power in two different ways: First, we can educate others on the threat posed by the debt burden, portraying it as a vital issue that people can’t ignore. Second, we can educate ourselves, to increase our future levels of productivity and use our human capital to ensure that we do not shoulder the entirety of this debt. However, as with most issues, we must also tackle the root cause: Future generations should implement political reform, entitlement reform, and allocate fixed amounts of the budget to investment in the future.
The debt burden is large, but so is the potential of our upcoming generation. We must throw off the burden and live, debt-free, into the future.