ATLANTA, GA, October 26, 2020 /Neptune100/ — Allen Buckley, a fiscal conservative independent candidate in the special election race for the U.S. Senate seat currently held by Kelly Loeffler, says most parents and the media are potentially catastrophically missing the big picture.
Many parents spend tremendous amounts of time and money, educating their children. Presumably, they do so because they want their children to have a good future.
Based on the presidential debates and media questioning of federal candidates, the media has skipped the national debt as a campaign issue. Apparently, it believes it is not important.
The national debt now exceeds $27 trillion. It is a major problem because in 2007, when total debt was less than $9 trillion, the Government Accountability Office (GAO) said: “GAO’s current long-term simulations continue to show ever larger deficits resulting in a federal debt burden that ultimately spirals out of control.” Annual revenue has never exceeded $3.5 trillion, and the budget has not been balanced since 2001. In 2011, when total federal debt was approximately $15 trillion, Admiral Mike Mullen, then head of the Joint Chiefs of Staff, called the national debt the nation’s greatest national security threat.
Former Assistant Deputy Secretary of the Treasury Gene Steuerle said in his 2014 book Dead Men Ruling: “Nations that face exploding debt levels or the kind of problems outlined above [relating to the United States’ financial problems] often refuse to pay their debts and declare bankruptcy. Because so many nations depend on the U.S. dollar to stabilize world markets, a U.S. default could prompt not just a U.S. crisis, but a global depression.” A global depression would wipe out the stock market. More likely is what the Federal Reserve Bank is now doing—printing a lot of money and keeping the Fed rate at zero. It will very likely be kept there for many years because a democracy loses its legitimacy when it begins using a significant amount of its tax revenue to pay interest. As a result, CD rates, short-term bond rates and mortgage rates are at all-time lows, and the stock market is at or near an all-time high. Real estate and stock market bubbles exist.
On September 21st, the Congressional Budget Office (CBO) issued its latest long-term budget outlook. It paints a vivid picture of a nation slowly being destroyed by debt. The CBO report states that by 2043, net interest expense is expected to cost more than all discretionary spending combined. By 2050, interest expense is expected to equal 44 percent of tax revenue. These are rosy projections, as they assume all tax breaks of the 2017 act set to expire in 2026, expire.
The rates used to reach these potentially catastrophic conclusions are relatively low rates. On page 21, the September 21st CBO report states: “Notably, the interest rate on 10-year Treasury notes rises from an average of 0.7 percent in mid-2020 to 3.2 percent in 2030 and 4.8 percent in 2050—one percent below the 5.8 percent average recorded over the 1990-2007 period.” On page 15, the report states: ” . . . if the average borrowing rate was 1 percentage point higher every year than the rate underlying the agency’s extended baseline projections, but all other aspects of the economy were unaffected, then the government’s net interest costs would amount to about 15 percent of GDP 30 years from now . . . [t]hat amount is about four-fifths of federal revenues projected for 2050.”
The On October 7, 2020, the Committee for a Responsible Federal Budget (CRFB) said: “Under our central estimate, we find President Trump’s campaign plan would increase the debt by $4.95 trillion over ten years and former Vice President Biden’s plan would increase the debt by $5.60 trillion. Debt would rise from 98 percent of GDP today to 125 percent by 2030 under President Trump and 128 percent under Vice President Biden, compared to 109 percent under current law.” The costs exclude spending to address the current pandemic and economic crisis. An October 5, 2020 opinion by Maya MacGuiness in The Washington Post noted Trump approved “a whopping $3.9 trillion in borrowing for new tax cuts and spending between 2017 and 2026.” It noted that Trump promised (in 2016) to reduce domestic spending by $750 billion over 10 years and instead increased it by $700 billion. It also said: “All told, every major area of the government has grown significantly under the Trump Administration.”
The Congressional Budget Office (CBO) reported on September 21, 2020, that it expects deficits of $1.81 trillion, $1.336 trillion, and $1.124 trillion for 2021-2023, respectively, assuming no major additional spending based on COVID-19. However, an additional COVID-19 bill will very likely be passed, causing these figures to grow substantially. The pandemic has hit the nation much worse than the Great Recession. And, the CBO said earlier this year that, from a financial perspective, it expects it will take ten years for the U.S. to recover from the pandemic. Prior to 2020, over $8 Trillion of debt was incurred following the Great Recession of 2008-2009. Since COVID-19 is worse than the Great Recession from a financial perspective, much more debt can be expected over the next decade. And, pandemics expert Peter Daszak said earlier this year that a must bigger pandemic can be expected in the next ten years. It is looking ominous.
Buckley said: “Most parents and the media are missing out on the big picture to the detriment of their children and the nation. Why try to educate or better your children from any perspective, while simultaneously creating a situation where they’ll have to live in a country that will experience a financial collapse? The stock market is a bubble because of TINA—there is no alternative—due to the huge national debt. History shows: Collapsing democracies—most collapse due to loose fiscal policy—are followed by dictatorships. People should watch Dr. Zhivago. Many think it’s an issue for their grandchildren, when it’s an issue for them. I offer solutions to the financial problems. They require reasonable sacrifice. For those who want to vote for financial sanity, I present an option.”
Buckley’s “Save Tomorrow” campaign is about living for today and tomorrow, instead of living for today to the detriment of tomorrow. The focus is on doing things to make tomorrow as good as or even better than today, by acting now to address the nation’s financial challenges and confronting global warming in a practical way.
Mr. Buckley is an attorney/CPA. He can be reached for comment at (404) 610-1936. Mr. Buckley’s campaign website is www.buckleyforsenate.org.