Ross Perot’s death marks the end of an extraordinary life well-lived. I am sure that many others join me in extending thoughts and prayers to his family. I am equally struck by the fact that his death marks the passing of the last time our nation had anything close to a real conversation on debt, deficits, and government spending.
His simple charts brought to life the degree to which our nation was living on borrowed time due to the way that political promises didn’t square up with financial reality.
What hits me today is not only that he was right on these financial matters, but how much deeper our financial hole has grown since we had at least something of a national conversation back in the early 1990s on this front. Though it seems that no one in Washington is willing to even mention the words debt or deficit, mathematically, our country is in the worst financial position that it has ever been in since our nations start and the Civil War.
Respectfully to this point, let me present you with five data points that our old friend Mr. Perot would have inevitably boiled down to a simple concept supported by great charts. They would underscore how frightening our current financial position really is.
One, our nation’s debt sits on a mountain of global debt. In fact, global debt is at its highest levels ever as it went up, not down, by $60 trillion in the wake of the 2008 financial crisis — a crisis caused by too much debt.
Two, our national debt is about equal to where it was when we were fighting the Japanese and Germans for our survival as a republic. At first glance this doesn’t seem the picture given public debt is about 80 percent of GDP and it went up to 106 percent in the aftermath of WWII. But at that time, we didn’t have the social safety net that we do now. Accordingly, if you compare apples with apples, it’s not far off given the enormity of these contingent liabilities. We are indeed in uncharted waters given we’ve never had debt this high in peacetime.
Three, government debt is now growing exponentially. It took 200 years to accumulate $5 trillion in national debt. It doubled under President George W. Bush from $5 to $10 trillion. It doubled again from $10 to $20 trillion under President Obama. Under Trump’s watch it’s well on its way to doubling again given his spending has exceeded even Obama’s spending.
Four, interest is the fastest-growing area of federal government expenditure. Even with today’s low interest rates, it is projected to more than triple over the next 10 years as interest payments are scheduled to rise to about a trillion dollars a year. In just three years we will spend more on interest than we do on defense. Amazingly, we are not talking about this.
Five, and finally, because of our level of debt and the low interest rates the Federal Reserve has orchestrated, a wide variety of assets are priced at dangerously elevated levels based on any look at historic norms. Artificial highs don’t end well, and the saying is that the higher they climb, the harder they fall. Since these asset prices have contributed to consumer spending and our economy, their fall will be catastrophic for our economy.
The long and short of all this is that we need another Ross Perot moment. For a brief moment, he awoke many in Washington to the dangers of deficits and voters’ concerns over Washington’s seeming ambivalence toward them. Disinterest from Washington is something we can no longer afford as we walk to what President Clinton’s former Chief of Staff Erskine Bowles called “the most predictable financial crisis in the history of man.” Similarly, former Joint Chiefs of Staff Chairman Mike Mullen, when asked what he considered our nation’s gravest threat answered, “not the Taliban, or the Chinese, but the national debt.”
Far too many signs point to dangers on the road ahead based on government spending and its accumulated deficits and debt. It is for that reason I indeed wish Perot was with us today. He would inevitably have a stack of charts already organized that would be worthy of our time, study, and focus. It’s time for another Ross Perot moment.
Mark Sanford is a Republican who served as the governor of South Carolina from 2003-11. He represented the state’s first congressional district in the United States House from 1995-01 and from 2013-19.
The views and opinions expressed in this commentary are those of the author and do not reflect the official position of The Daily Caller.