KOKOMO – I begin my annual National Debt rant with two questions for our illustrious members of Congress and the president: 

1. Do you fully understand that the trajectory of our debt growth will eventually economically crush our country and jeopardize even our treasured freedoms? 

2. At what point do you finally take significant action to address this existential risk?

Just a mere 18 years ago, our National Debt was at a quaint and manageable $6,000,000,000,000. I write out all of the zeros because 12 zeros seem amazing to me. In just eighteen short years our debt has soared to just shy of $22 trillion. Why does this growth in our debt seem to scare only me and a few wonkish college economics professors?

Basic economics tells us that you cannot maximize production of both guns and butter without causing negative effects on your economy. The usual impact of massive government borrowing to fuel even greater massive spending are high levels of interest, high levels of inflation and high unemployment. Remember Ronald Reagan’s misery index? By all conventional wisdom, it should now be off the charts, but it is not.

We presently have low interest rates, low levels of inflation and record low unemployment. While I am personally pleased with the current state of the economy, deep down in my soul I get a squirming feeling that these present good times are just an anomaly. Is it possible that the primary reason that things are going so well economically at this time is that the United States is the economic rock of the world with no peer in sight? Does foreign money fuel our ability to borrow and spend through their purchase of our Treasury securities because we are the safest game around? What if we weren’t? What would happen then?

In the late 19th Century, Germany was widely considered to be one of the strongest and most advanced countries in the world. Their education system was believed to be second to none. It had early childhood education. Its secondary schools emphasized cultural training. German universities were modern research schools and distinguished for their achievements in science.  

Karl Benz invented the gasoline powered automobile, Rudolf Diesel invented the compression ignition engine, Heinrich Hertz discovered electromagnetic waves, Wilhelm Rontgen invented x-rays, Friedrich Kekule developed the theory of chemical structure, Paul Ehrlich produced the first medicinal treatment for syphilis and then there was that guy Einstein.

Germany had it going until its leaders mindlessly plunged itself into a little conflict we like to call World War I. The German government borrowed heavily to finance their war effort. It did so with the full intent of making its victims repay the loans. Oops! Sorry, Wilhelm. It didn’t work out that way. Post-war Germany was saddled with both its war debt and reparations inflicted upon it by the victorious allies.

Politicians being what they are the world around, the German politicos vied for the affections of the German people by launching huge social programs. University enrollment exploded, almost doubling the pre-war numbers, encouraged by no fees, free textbooks, free clothing, free medical, free transportation and substantial living allowances. There were free concert tickets and hefty discounts on food.

Almost 90% of German government spending went for big bureaucracy, social programs, money- losing nationalized businesses and other subsidies. The Germans subsidized municipalities. They ran an insolvent government-run pension system. The German government provided health insurance for millions of people. There were 1.5 million disabled veterans to provide support. The government subsidized the arts. There were free government theaters and opera houses. The government-owned railroads lost money. The German government-owned factories producing sausages and margarine lost money.

For a defeated nation, life was pretty good as German borrowing continued to finance a comfy lifestyle for its people. And then life abruptly changed.

In 1923, France sent troops into the industrial heartland of Germany, the Ruhr, in an effort to enforce payment of war reparations. The German government responded by subsidizing those who pursued a passive resistance against the French. As more debt piled on, deficits ballooned.

At the peak of its inflation problem in late 1923, only 1.3% of German government spending was covered by tax revenue. The result was that in five short years prices soared over 100 billion-fold.  

Inflation crushed everyone. Many bank deposits were devalued to nothing. Unemployed coal miners roamed the countryside looting and plundering because farmers refused to trade their produce for worthless paper money. The government enacted rent controls and housing developments ceased. Libraries and museums closed and dissolved their collections. Scientific research nearly ground to a halt. On Fridays, workers would rush to the food stores so that they could buy before prices rose. Those in the back of the long lines might pay twice as much for bread due to the quickly rising inflation. Government employees, taking care of themselves, arranged to have their salaries pre-paid so they could buy goods ahead of the weekly inflationary surges.

It was into this void of government debt-fueled hyperinflation that an out-of-work, World War I, Austrian-born Wehrmacht corporal stepped. His assignment for the blame for all of Germany’s many problems was easily placed on the wealthy, the capitalists and the Jews. He promised a greater Germany with an undefined vision of hope and change.

A desperate and depressed German people took his message hook, line and sinker and the rest is history. But could it happen here?

In 2018, our annual budget deficit was $779 billion in spite of record tax revenue collections. That represented a 17% increase in the annual deficit. The Congressional Budget Office projects that the U. S. government will spend $7 trillion in interest payments alone over the next 10 years. The CBO also projects that the average income will decline by $5,000 over the next 30 years based on the current debt trajectory. One half of our national debt is owned by foreign countries. Medicare and Social Security are both in jeopardy. The problem gets worse by the day as neither major political party seems to recognize the serious nature of the problem.

Both Republicans and Democrats are thrashing about looking for ways to politically exploit the problem. Our last president rode to power with undefined promises of hope and change and the debt piled up. Our current president rode to power with a mantra of making America great again and the debt keeps piling up. The Democrats target the productive class and seek to take from the wealthy and give to the poor. The Republicans have focused on an immigration problem, giving its disaffected supporters someone to blame.  

In Russia, wealth came to be recognized as anyone who owned one cow. In Nazi Germany, having a group to blame eventually turned into a holocaust.  

Our present uninterrupted course of government borrowing and spending at all levels will eventually result in sky high interest rates, astronomical inflation rates, stagnant economic growth, lower wages and a much lower standard of living for everyone. It will happen. I guarantee it. The only unknown is when the economic Armageddon will occur.

Frankly, it is the unknown nature of the timing of our future economic disaster that prevents our elected officials from dealing with the problem.  The next election always comes before the expected day of reckoning. The path of least resistance is where the political waters flow. Easy fixes and glib responses to a potentially catastrophic problem seem to be all we can get out of our elected officials. I’m sure that most of our current elected representatives believe that the day of reckoning will come long after they are gone from office or this world. They may be right, but what does that say about us?

My parents were part of the “Greatest Generation.” They weathered the storm of the Great Depression, they fought and died for our freedoms in World War II and they built the United States into a global economic powerhouse with their ingenuity, sweat and dedication. 

Unfortunately, their son may go down in history as being part of the worst generation. We were born into a peaceful time, raised without knowing deprivation, indulged ourselves at every turn and we never, ever, denied ourselves anything that we wanted. We spent our birthrights and now we are engaged in spending our grandchildren’s futures. Our selfishness puts all that we hold dear at risk.

History has taught us nothing if it has not taught us to beware the man on the white horse. 

Dunn is the former 4th CD and Howard County Republican Party chairman.