It’s not uncommon for a government to spend more than it can raise in taxes. When that happens, the Federal Government borrows money to cover the required deficit. When the government has a surplus, it pays off the outstanding debts.
However, the US reached a major milestone when, on October 23, 1981, the national debt reached $1 trillion. To put that into perspective, every American man, woman, and child would have to carry $4,700 in debt, and it would take an astonishing 31,688 years to repay if every year following were a surplus.
When Reagan took office with anti-deficit policies, no one expected to face much of a national debt. However, the 13-digit debt was inevitable when the government invested heavily in defense. The US treasury continued borrowing large sums to facilitate its deficit budget while congress was implementing the biggest tax cuts in history.
The debt figure stood at $999.3 billion for days before it went beyond the symbolic trillion-dollar barrier. It held steady for the day because the treasury securities redemption and issuance matched.
- The federal debt was at 18% after World War II. However, it rose by 33.5% during the Bush and Reagan regimes.
- The US National Debt hit its lowest: -$37,513 in 1835. The budget deficit began to rise mainly due to military spending.
- The public debt reached 1 trillion dollars after 205 years.
- When Reagan took office, the GDP had reached 32.5%, the lowest since 1931.
Fun Fact percentages are confusing. 18, 33.5 and 32.5% of what?
By the way A. Hamilton did not want to borrow money. It was done anyway. Herbert Hoover did not want to borrow money and ran on that platform. F.D.R. didn’t want people to be idle so he spent and spent. He ran for 4 ? terms. It is beyond my control, but look at Washington now forgiving, student loans, personal debts, etc. If we aren’t indentured then what are we?