Chapter Four

Debts Do Matter

Borrowing, Borrowing, Borrowing

Uncle sam borrows 42 cents for every dollar it spends. We borrow about $4 billion a day. That’s according to a one-month figure of $125 billion given by Treasury Secretary Tim Geithner.

How did we come to this? By the time we reached our 43rd president’s term, the national government took leave of its financial senses and simply stopped paying for anything. Forget paying for two wars, tax cuts, or Medicare drug benefit.

Counting just the most recent and crisis-filled presidency, we’ve accumulated more debt in this period than we had from George Washington’s day to the time that Bill Clinton scored his seat in the Oval Office.

The situation has never been graver.

Let’s talk magnitude for a second. If Bill Gates gave every single penny of his fortune to the U.S. government, it would only cover the U.S. budget deficit for about 15 days. If Warren Buffett took over after that, he could float us another 13 days.

Or consider this charming gesture from a dead man in Coral Gables, Florida. He left his home and $1 million in cash to the government—for the purpose of paying down the national debt.

His 1929 Spanish style home—3,900 square feet, six bed/five bath, in need of “updates”—grossed $1.175 million at auction. The deceased’s generosity won’t go very far: Uncle Sam blew through his inheritance in less time than it took you to read about this—17 seconds.

Here’s the deal: All that debt is manageable for as long as you can service ...

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