The HuffPost had an article last April called “5 Refreshing Lessons From Elizabeth Warren’s Personal Finance Book.”
According to Sen. Elizabeth Warren, “Debt steals from your future, every monthly payment that goes toward debt is a claim against your future.”
On an individual basis, debt steals from your future. However, in some cases, debt may not steal from your future, but from someone else’s future.
In the 1980s, baby boomers would inherit an economy where GDP growth rates were 5 percent versus the lousy 2 percent average since 2008, and the national debt was only $1 trillion.
The boomers would take advantage of this by electing politicians, whether they were Republicans or Democrats, it didn’t matter, as long as the politician borrowed and squandered trillions of dollars.
From 1980 to 2019, the federal government would borrow $22 trillion, real estate investors would borrow $16 trillion, corporations would borrow $9 trillion, municipalities would borrow $4 trillion, students would borrow $1.6 trillion, and car buyers would borrow $1.2 trillion (Federal Reserve Economic Data Center, St. Louis).
The Federal Reserve was the exorbitant enabler lowering the Fed funds rate from 19% in 1981 to zero percent by 2011.
Meaning, government, businesses and consumers have taken on a humongous amount of debt that isn’t stealing from their future, but is stealing from the next generation’s future.
If you believe that “deficits don’t matter,” that the U.S. can continue to borrow trillions of dollars, generation after generation, then stay with the status quo and elect more politicians like Obama and Trump.
However, if you’re under 40 and you feel that younger generations are already feeling pain from the debt burden left behind by older generations, you’d better start voting for someone other than a Republican or Democrat.
Unfortunately, virtually every politician running for president in 2020 is tacitly proposing more “voodoo economics,” which says you can literally print prosperity.
Even Elizabeth Warren, who says she believes “debt steals from your future,” is running on a platform of more voodoo economics (also called MMT or Modern Monetary Theory).
Younger people need to support a different kind of politician. A politician who practices what they preach: “The children are our future, so why do we continue to saddle the young with trillions of more debt.”
Around the world, young people are protesting for righteous reasons. They had little to do with the $253 trillion in global debt created in just the past 40 years by older generations, myself included.