One afternoon several months ago, Nicol and I were sitting on the couch doing some casual reading. I didn't know the title of her book but, as she often does, she was sharing blurbs from it as she whizzed thru it, paragraph after paragraph, page after page. She's one of those annoying people who can sit down with a book, thumb thru it in about an hour or two and know with a great deal of accuracy the author's basic premise, as well as most of the significant details therein. And if you ask her about it, like, 3 years later, she STILL remembers many of the details. Honestly... it bugs me... a lot. No one should be that smart. [ :-) ]
Anyway, that's not my point. As she was spouting off fact after fact and statement after statement, I asked her what she was reading. "It's called 'The Coming Economic Earthquake,'" she replied. So, naturally, I asked her who wrote it and she told me, "Larry Burkett, in 1991." "1991?! What?!" I asked/blurted out. "Yes."
The reason 1991 was so surprising is that what she was reading to me was so eerily similar to, if not exactly like, what was happening at that time with our economy. Remember last fall, when The Fed was lowering interest rates, Wall Street was sinking like a lead balloon, banks for falling apart at their financial seams, and the once-booming housing market was plummeting? I could not believe that this writer, Larry Burkett, had so accurately described the economic conditions that we were witnessing at that time, and have continued to experience to this day... and I'm not sure we realize just how significant this "recession" or "downturn" in our economy really is.
Below are links to a two-part interview conducted in 1992 by James Dobson (founder and chairman of Focus on the Family) with Larry Burkett (deceased; was co-founder and chairman of Crown Financial Ministries). It was re-aired by Focus in October 2008.
These interviews are well worth the 55 minutes or so that it will take to listen to them in their entirety. I would highly recommend that you check 'em out. Much to my regret, I am finding just how undereducated I am on this issue, and I am convinced that we can't ignore it, nor can we avoid educating ourselves on it because the problem is so significant that it simply will not allow itself to be ignored for much longer. It has crept up on us and it has the potential to destroy our country as we have known it. This is serious and this country's sovereignty may hang in the balance. As extreme as all that may sound, I do not believe that it is extreme at all... I believe that it's an accurate description of what we are facing. To be sure, only history will be able to inform us as to the severity of all this, and I'm definitely not making any predictions here, but we had better wake up, educate ourselves, and get as prepared as possible for what lies ahead.
Why is this such a big deal? I'm no economist, and I'm certainly not a finance guru, but I can do basic math, and it seems to me that we are in a heap of trouble when it comes to our future... both economically and generally speaking. I don't consider myself an alarmist by any stretch of the imagination, and I don't think those who know me do either, but I believe that we are in for some drastically difficult times... and given the fact that I've never wanted for ANYTHING in my life, I don't have the first idea what "drastically difficult times" means... and that concerns me.
Here are a few statistics that Burkett shared during his interviews with Dobson...
- in 1980, the federal government owed $700-800 billion
- in 1990, the federal government owed $3 trillion
- in 1992, the federal government owed $4 trillion
- today, the federal government owes in excess of $10 trillion, possibly as much as $12 trillion
The point? The federal deficit has grown exponentially over the past 3 decades. And this year alone it is projected that we will have a federal budget shortfall of $1.75 trillion.
Let me put that in perspective for you... and I think the figure below is correct... you can play with the numbers at bankrate.com... it's very possible that I've got this messed up somehow, so please let me know and I will stand corrected... these kinds of numbers are surely not what I'm accustomed to dealing with... whatever the case, this stuff is mind-boggling.
- If you amortize $1.75 trillion (the projected federal budget deficit for this year) over 1,000 years (that's right, a thousand years!) at 1% interest (good luck finding that rate; having said that, I have no idea what our government gets for interest rates on its loans) you'll be paying $1,458,399,820.88 per month. Basically, that's $1.5 billion every single month. Told you this is scary stuff. And keep in mind that $1.75 trillion only represents the coming year. We've got another $10-12 trillion on the books. Think about that for a minute.
But here's where it goes from bad to worse: we can't afford our current payments and yet we continue to borrow more. Check out these stats from Burkett, which reflect the percentage of taxes paid by every taxpayer that went toward paying the interest on the national debt (interest only, not principal).
- 1991 = 40%
- 1995 = 75%
- 2000 = 100% (as projected by Burkett; he passed in 2003)
The bottom line? As Burkett said in 1992, "we are creeping our way to the point where our government can't borrow enough money to pay our bills."
Here's where we are today folks... borrowing money to pay the interest on our debt... and eventually we won't even be able to borrow enough to pay the people we owe... interest or otherwise. Not a good situation.
All this is precisely why all this talk of "stimulus" and "bailouts" should concern us all. Borrowing more on top of what we already owe is a recipe for disaster. Again, I'm no economist, but if someone owed $8,000 in credit card debt (which, incidentally, is the national average) who in their right mind would encourage that individual to borrow another $1,000 with the hope that it would somehow, in the long run, help them to pay off that debt? No one would do that because it wouldn't work! And yet, fundamentally, that is exactly what our government is doing.
Burkett was onto something 17 years ago. His book was a NY Times Best Seller. Many took note of his warnings, but many others dismissed his work out of hand, calling him an alarmist. It's understandable how people could dismiss and ignore what he had to say back then - 1991 - but now, in 2009, with everything that has taken place in the past 6 months and with the projected indefinite continued downturn in the economy, we had better at least give this serious consideration. Hopefully it's not too late.
The concept driving my concern is both biblical and practical... the borrower is servant to the lender. (Proverbs 22:7) Whereas the U.S. was once the lender, we have become the borrower, and that is dangerous territory. In many ways, we are at the mercy of those to whom we owe this money.
Let me try to end this on a positive note with a much-needed dose of biblical perspective...
Give your entire attention to what God is doing right now, and don't get worked up about what may or may not happen tomorrow. God will help you deal with whatever hard things come up when the time comes. (Matthew 6:34, The Message)