QUESTION #2: What is the U.S. debt? What is the international debt? And how would you respond to many pundits and so-called experts say that the debt is really not that much of an issue?
Answer:
Dan Celia:
“I think we have a serious problem in America with the debt. There’s no doubt about it. I think we have about $141 trillion, that’s by my numbers. Most would say it’s more than that. We have $20 trillion of immediate debt, as we hear that number all the time. And we’ve got another $121 trillion or so in unfunded liabilities debt. So, debt is a very, very serious problem. You know, just to kind of get back to the international thing, let me just say this before I give you an answer on that solution. But you know, one of the things that those pundits you were just talking about are drinking the same Kool-Aid that everybody in Congress is drinking.
They’re drinking that Kool-Aid as a result of a lot of lobbyists and a lot of other congressional leaders that believe it, and lobby for the idea that debt is not an issue. And one of the reasons why they give that scenario that debt is not a problem and we shouldn’t be concerned about it is because we are about, well, according to the government, we’re about 78% debt to GDP. According to my numbers, my numbers are accurate, the governments are not, and I use government numbers to get my number. So, we’re at about 102% of debt to GDP. So, we have a 102% to GDP.
Congress believes it’s not an issue. You know why? Because Japan is about 250% debt to GDP and they’re just chugging along fine. And China is about 450% debt to GDP and they’re just doing fine. That would be communist China, dictatorships are total control. China is about 450%. So, Congress says, “Well, wait a minute, as a matter of fact, they’re okay, they’re doing okay, but we’re even better as an economy and as a country than either one of those, so we don’t have a problem.” Here’s the problem, the problem is that we have a problem because what they leave out of the scenario is that China and Japan are export nations, their entire economy is based upon exports.
The entire economy of the United States of America, or 71% of it, is based on consumer spending. We’re not an export nation. We’re a long way away from being an export nation. Our economy operates and has different needs than does Japan and China. We don’t have time to go into all the detail about it, it gets complex. But with that in mind, we’ve got a serious problem, and it’s a problem that has to be addressed.”
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