Minnesota
Good Question: How did the U.S. debt get so high?
MINNEAPOLIS — If you wince when look at your monthly credit card bill, you might not believe what the U.S. government has racked up.
The national debt now tops more than $34 trillion. That’s a new record difficult to comprehend — and there are no signs of slowing it down.
How did the debt get so high? And will it need to be paid off?
Well, that goal might be wishful thinking.
The debt is one of the rare times people have a chance to use the word “trillion” in a sentence without exaggerating some number.
It stands at $34,009,690,055,595 as of Jan. 9. Elon Musk, the world’s richest person, is worth more than $241 billion. You’d need at least 140 of him to equal the debt.
“The first thing is about one-fourth to one-third of it doesn’t count,” said Christopher Phelan, an economics professor at the University of Minnesota. “It’s debt that’s held by another part of the government. So, it would be like the wife owing the husband money. It doesn’t affect the household. But the rest of it is still a huge number.”
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How did the U.S. accrue such a huge debt? One of the main culprits is consistently overspending. When the federal government spends more than its budget, it creates a deficit. In the fiscal year of 2023, it spent about $381 billion more than it collected in revenues.
To pay that deficit, the government borrows money. That can happen by selling marketable securities like treasury bonds. The national debt is the accumulation of the borrowed money, plus interest.
“Right now the federal government is spending 1.5 times as much as its taking in. So, an analogy that I’d like to give is imagine that a couple is making $80,000 between the two of them and spending $120,000 a year,” said Phelan. We asked him if the U.S. is the equivalent of a person who only makes the minimum payments on a credit card. Phelan took it a step further saying, “The U.S. is like somebody who makes less than the minimum payment on their credit card.”
The country was literally built on debt. It was $75 million in the red after the Revolutionary War thanks to loans from investors and countries like France.
The Civil War led a to a huge spike, raising the debt from $65 million in 1860 to nearly $3 billion in 1865 when the war ended. Costly wars proved to be a theme in our nation’s history. The debt was at $49 billion right before the U.S. entered World War II. When the war ended, it was $260 billion. It began rising at a fast rate in the 1980’s and was accelerated through events like the Iraq Wars and the 2008 Great Recession. Most recently, the debt made another big jump thanks to the pandemic with the federal government spending significantly more than it took in to keep the country running.
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Who do we owe the money to? “Mostly ourselves,” said Phelan. “A lot of pension funds own government debt, money market funds own government debt and then people own those money market funds.” The U.S. also has debts to other countries.
Where does the money come from that would go towards paying off the debt? It ultimately comes down to the U.S. taxpayers. That means in order to pay it off, or at least make a larger dent in the debt, the federal government would have to raise taxes and cut spending. “The problem is way bigger than if we just cut foreign aid,” said Phelan.
With such a high debt, how does the country function? Phelan said it comes down to the debt to gross domestic product (GDP) ratio. That equation shows a country’s ability to pay down its debt. “This ratio is considered a better indicator of a country’s fiscal situation than just the national debt number because it shows the burden of debt relative to the country’s total economic output and therefore its ability to repay it,” according to the U.S. Treasury’s website.
The current ratio in the U.S. is about 123 percent as of Sept. 2023. Two decades earlier in 2003, it was down to 60 percet. According to CEIC, the highest the ratio ever reached in the U.S. was 130.6 percent in March 2021, roughly one year into the pandemic.
While the ratio remains high for the country, Phelan said other countries are worse off, yet continue to run. Japan has a debt to GDP ratio that’s well over 200 percent, but that doesn’t mean countries should comfortably operate at those levels for a long time. “There is a limit, and it’s determined by when potential bond buyers say ‘I don’t think I’m gonna get the money back.’ And they demand a huge interest rate for risk of not getting the money back,” said Phelan, adding how that concern hasn’t happened yet for the U.S.
A rest area along Interstate 94 in Minnesota has been closed to trucks until about Independence Day to accommodate an almost $3 million improvement project.
The eastbound I-94 Enfield rest area between St. Cloud, Minnesota and the Twin Cities between Wright County Road 8 and Highway 25 is now closed to cars and commercial vehicles as crews resurface the entrance and exit ramps, and update nearby sidewalks.
According to KNSI, the full closure is just the first phase of the project. The rest area will reopen to passenger vehicles only the week of May 11th. During that time, the truck parking area will remain closed as crews repave the lot.
The truck parking lot will reopen the week of June 30th, right around Independence Day. During that time, the passenger vehicle area will be shut down to allow for the resurfacing of the lot. The Minnesota DOT expects the rest area to be fully open by late July. The entire project is expected to cost $2.9 million.
Drivers heading east on I-94 are encouraged to use the Big Spunk Lake rest area near Avon, or to drive a little farther out to the Elm Creek rest area.
Could a UCLA baseball team that’s perfect in Big Ten play get better?
Bruins coach John Savage thinks so, which is a frightening prospect for the rest of a seemingly overmatched conference.
While Savage’s top-ranked Bruins completed a three-game sweep of Minnesota on Sunday with a 5-2 victory at Jackie Robinson Stadium — stretching their Big Ten winning streak to 21 games — he said there’s more upside to be realized.
“Offensively, we just really couldn’t get a lot going,” Savage said after his team went 1-for-5 with runners in scoring position and stranded six baserunners. “We just weren’t able to put a lot together, but when that pitching and defense shows up every day, it gives yourself a chance to win, and that’s kind of what we did all three games, really.”
Those elements were so good Sunday that they overshadowed Roman Martin’s solo homer in the third inning and Will Gasparino’s two-run shot in the sixth.
Bruins left fielder Dean West made three superb catches — two leaping and one diving — and four relievers combined to give up only one run in 4 ⅔ innings. Closer Easton Hawk needed only six pitches to record a 1-2-3 ninth inning while notching his third save in as many days.
Savage credited Minnesota’s pitching after the Golden Gophers (22-17 overall, 5-13 Big Ten) held the Bruins (36-3) to an average of five runs during the series and said many of his team’s offensive struggles were situational.
“We have very, very good offensive players — some of them are in … little ruts right now, but that’s OK,” Savage said. “These guys play a lot and get a lot of at-bats; there’s a lot of ups and downs.”
When it comes to UCLA’s conference record, it’s all been up.
What it means
UCLA’s sweep is further evidence that the Bruins aren’t getting complacent because of their record.
“This culture is really solid, and these guys truly believe in one another and they’re playing for the team,” Savage said. “We’re very fortunate to have this group, and so they love playing together, so there’s no complacency and there’s no reason to because we haven’t done anything; I mean, you’re 36-3, that’s great, but at the end of the day it’s about getting better and playing your best baseball the next 75 days.”
Turning point
Spotting a dominant team an early lead is never a good idea.
That’s what happened when the Bruins struck for two runs in the bottom of the first inning.
West led off with a single to center field, took third on Roch Cholowsky’s double to left and scored on a balk. With one out, Martin hit an RBI infield single off the pitcher’s glove. UCLA was up 2-0, and the Golden Gophers could never catch up.
Did you see that?
Minnesota did not like it when Gasparino admired his home run by lingering in the batter’s box before commencing his trot around the bases.
There was consensus in both dugouts because Savage also didn’t care for it.
“I thought he probably stayed in the box a little too long for me,” Savage said. “That’s kind of not who we are, and they didn’t like that; I wouldn’t like that either, really.”
MVP
West saved multiple extra-base hits with his catches.
Which was his favorite?
“Probably the diving one,” West said. “I think that was the coolest one. I got to leave my feet and make a play on it.”
Up next
The Bruins will open a five-game stretch of nonconference games when they host Hawaii on Tuesday evening at Jackie Robinson Stadium.
Of the many terrible roster decisions Minnesota sports teams have made over the past 30 years, the worst of the bunch may have been trading Randy Moss to the Raiders for the No. 7 pick in the draft and linebacker Napoleon Harris.
Why are we bringing up a trade that happened 21 years ago? Because the New York Giants traded defensive tackle Dexter Lawrence to the Cincinnati Bengals for the No. 10 pick in this week’s NFL Draft. It was the first time a non-quarterback has been traded for a top-10 pick since the infamous Moss trade in 2005.
Minnesota traded Moss for the Raiders’ first-round pick, Harris, and a seventh-round pick on March 2, 2005. The Vikings used the No. 7 pick on wide receiver Troy Williamson, who never panned out in the NFL. He had 24 catches for 372 yards and two touchdowns as a rookie, 37 receptions for 457 yards and zero touchdowns in 2006, and just 18 catches for 240 yards and one touchdown in 2007.
Williams led the league with 11 dropped passes in 2006. Minnesota traded him to the Jacksonville Jaguars for a sixth-round pick after the 2007 season, where he played in 10 games over two seasons and totaled just eight catches for 64 yards. He was cut before the start of the 2010 season, and that was a wrap on the former South Carolina speedster’s NFL career.
Moss didn’t put up jaw-dropping numbers with the Raiders for two seasons, but he set an NFL record with 23 touchdown catches in 2007 with the New England Patriots. He caught 47 touchdowns in 48 regular-season games with the Patriots from 2007 to 2009.
Whether it was trading Moss to the Raiders, the Timberwolves sending Kevin Garnett to the Boston Celtics — or drafting Ricky Rubio AND Johnny Flynn over Steph Curry — or the Twins cutting David Ortiz and watching him become one of the greatest players in MLB history with the Boston Red Sox, Minnesota sports teams have a long history of making terrible decisions.
The Bengals, meanwhile, gave up the 10th overall pick for one of the best defensive tackles in the league. They’ll likely get great production from Lawrence, while the Giants are now under pressure to get the 10th pick right. New York also holds the No. 5 pick in Thursday’s first round of the draft.
By the way, the Vikings had two picks in the first round of the 2005 draft. After taking Williamson, they used the No. 18 pick on defensive end Erasmus James. He was just as much of a bust as Williams, playing in 23 games in three years with the Vikings. He had four sacks as a rookie, but injuries wiped out most of his 2006 and 2007 seasons before he was traded to Washington for a conditional seventh-round pick.
James was cut by Washington in December 2009, marking the end of his NFL career.
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