If you’ve walked around Times Square in New York City in the past twenty years, you may have seen the National Debt Clock which hangs atop the square, rapidly counting up the national debt of the United States every second. 

Fourteen months ago, the New York Real Estate company which owns and manages the large clock had an interesting predicament.  It was at that point that the National Debt hit $10 trillion.

The designers of the clock in 1989 never considered the necessity of allowing for more than 10 digits.  When faced with the dilemma, the decision was made to drop the dollar symbol from the clock and use the space previously dedicated to it for the eleventh digit so that the accurate number appears on the clock. 

The owners are now creating a replacement which will have ample room for a dollar symbol and a 12 digit number.  Should the national debt ever reach a quadrillion dollars, thus demanding 13 digits, the dollar symbol will have to once again be eliminated.  If you think that there’s no chance of the debt reaching a quadrillion dollars, think again.  The actual debt figures are far worse than what we are being told.

No, I’m not calling out a conspiracy. 

The National Debt is indeed less than $11 trillion, if you look at the debt from cash basis accounting.  Cash basis accounting simply adds up all the money coming in and all the money going out and spits out the positive or negative tally.  In 2008, the deficit for that year was registered at $455 billion.  In 2009 it was just over $2 trillion. 

As outlandish as those numbers are, they are very misleading.  A large portion of the incoming revenue stream for each of those years came in the tax receipts such as Social Security and Medicare which are destined for future liabilities.  In other words, if $1 trillion of Social Security tax receipts comes into the Treasury in 2009, that $1 trillion must be paid out at a future date in the form of Social Security benefits. 

In other words, the government is using all tax receipts to pay current expenditures and no taxes are being held in reserve to pay out the benefits that taxpayers are accruing. 

This simply means that the Treasury will have to come up with $1 trillion dollars at some point to meet the future obligations that those receipts were destined for. 

Using General Accepted Accounting Principles (GAAP) which are used by the private sector to paint a truly accurate financial picture, tax receipts which are obligations for future liabilities are not counted as revenue for the year they are generated.  Therefore, using GAAP based accounting, the deficit for 2008 was really $5.1 trillion and the deficit for 2009 is over $9 trillion.   So, although the national debt is currently a little more than $12 trillion according to cash based accounting, the GAAP Total Federal Obligations accrued thus far is $74 trillion.

Did you read that?  We owe 74 TRILLION DOLLARS! 

And to think that Washington has the gumption to continue to unveil new spending programs costing us billions more.  For the past couple of years the U.S. has spent an average of about $400 billion per year to pay interest on the debt. 

By the year 2040, it is calculated that the entire U.S. budget will have to be used to pay the interest on the debt.  This means no money for Social Security, the military, national parks. Nothing but interest payments.

The amazing thing is that only a minority of people seem to be alarmed by this seemingly bottomless hole we’ve dug ourselves into.  The next time you hear someone ask you why you are against government healthcare, stimulus two or whatever new spending program that is the flavor of the day, tell them you can give them 74 trillion reasons why!

Brad Rudisail is a syndicated political columnist. He is a graduate of the Coverdell Leadership Institute and a resident of Oconee County.

---