I believe that debt is normal when we are talking about an average family, investing in their future by getting an affordable mortgage, and purchasing the family vehicles. These sources of debt are completely manageable when accompanied by the appropriate amount of income. However, debt can get out of control when you forget that those pesky interest rates can get out of hand with one late payment. It can also become a cumbersome burden when the income decreases or is lost. Before you know it debt can fall into a domino effect where you find yourself on the treadmill of just paying down the interest without even touching the principal because due to shrinking resources you can only manage the minimum payment. When you find yourself in those unfortunate circumstances that may be when you are in too much debt. This scenario has hit so many American households slowly over the past decade, especially due to stagnant incomes and increasing food, gas, education and health care costs prices. We are not even talking about being extravagant anymore at this point, it has gotten scary for the middle class nowadays.
This point can easily be turned towards the debate raging in the U.S regarding our deficits. Do I think that the U.S government has too much debt? I would say no, because there a few simple things to do that would turn the debt, at least in the short-term, immediately around. The first thing that I would do is eliminate the Bush tax cuts for the upper tier of the income bracket. Our short-term deficit would be erased by a few trillion dollars. I would then launch an infrastructure investment project to put Americans back to work and that would also generate the much-needed revenue lost by the Great Recession which was another driver of the short-term debt. Lastly, to address the long-term deficit, I would get us onto a single payer health care coverage system such as medicare for all. Businesses large and small would then be immediately unburdened of the responsibility of health care coverage costs which would free up additional capital to spark a hiring frenzy. Increased employment quickly snowballs into more employment which would get those revenues back into the coffers ready to invest in the country’s most valuable resources, its children and their education.
That would be my plan for this country.