The United States' national debt is $12.5 trillion.
So lot's of people are freaked out.
But how big is that really? National income, the total value of everything the U.S. makes
each year, is also huge. And all that misses the most important point: the U.S. government
can never run out of dollars. Unlike you, or the company you work for or the town you
live in, the federal government prints dollars. Or, actually, the Federal Reserve mostly makes
it with computers. The only think to worry about is inflation. If you have too much money
chasing a fixed amount of stuff, that means higher prices. And if inflation gets out of
control, the Fed will slow down the economy by raising interest rates. Higher rates for
the government mean even higher rates for businesses. That means less investment in
the private economy and slower growth. That's why you worry about deficits, because they
lead to inflation and higher interest rates. But these days inflation is the lowest it's
been in 30 years, and interest rates are also near record lows. So we could reduce debt
with higher taxes, or by cutting benefits, but that would take money out of people's
pockets -- means fewer jobs, it means lower incomes. So trying to reduce debt might actually
make the debt situation worse. So let's think of something else to worry about...
Debt just isn't a problem right now.