I was listening to the radio yesterday as I was returning from visiting a professional colleague. Two frightening news items caught my attention:

• The World’s population is now about 7 billion people.
• The U.S. Federal debt is now about $14 trillion. (Note added 7/28/2012: There are a variety of Web-based "data clocks." The site http://www.usdebtclock.org/ keeps track of the estimated U.S. debt. As of 7/28/2012 the estimate is over $15.9 trillion. The World Population Clock site at  http://www.worldometers.info/world-population/ estimates the world population at  7.056 billion.)

Being the numbers-oriented person that I am, I divided the larger of these two numbers by the smaller, and got an answer of $2,000 of U.S. federal debt for each person on earth. If each person on earth would contribute $2,000 to the U.S., it could pay off its debt.

Alternatively, each person in the U.S. could make a payment of about $50,000. That would wipe out the national debt. However, imagine a family of four living at the poverty level in the U.S. In the 48 contiguous states in the year 2012, this level was set at  $23,050. The U.S. national debt burden for a family of four is about $200,000—or quite a bit more than eight times that poverty level income.

A great many years ago when I was having my house built in Eugene, Oregon (where I still live), I was told a good rule of thumb was that one’s house should not cost more than 2.5 times their annual income. I just barely came in with a cost lower than that, and over the years I have not regretted this investment. The investment was in something tangible, something that I used every day, something that I could successfully pay off over the years, and something that maintained its value—indeed, increased in value.

Here is another interesting number. The current U.S. GNP (gross national product) is about $14.1 trillion. That is, our federal government debt is essentially one year’s income for the entire country. That may sound reassuring—but how does it compare to the annual income of the U.S. government?

The website http://www.usgovernmentrevenue.com/breakdown indicates the current year’s federal income is $4.5 trillion. So, using these figures, the U.S. debt is 3.1 times the annual income. Hmm. That does not sound too bad, if what the feds were doing was buying houses they were going to live in and that might appreciate in value. For example, investment in education has that characteristic of appreciating value over the years! Unfortunately, such is not always the case. I find it interesting to look at various federal expenditure categories and wonder whether they (like my house) are worth the cost of our country going into long-term debt.

Here is another piece of the story. This current year our the U.S. federal spending is about $1.6 trillion more than its income.

After my house was finished, I made monthly payments that steadily reduced my debt. I did this while living within my means, so that I did not build a still larger debt. I wonder what our representatives in Congress were thinking as they built up our huge national debt that still continues to increase.

Now, what does all of this have to do with education and improving our educational system? How do we raise and educate children so they become responsible adult citizens? How do we raise and educate children so they are not driven by the need for instant gratification and so will make well-reasoned fiscal and other decisions? 

My hunch is that this is becoming more and more difficult as the entertainment-driven components of our world steadily grow stronger, more attention-grabbing, more attention-holding, and more tuned to instant gratification. Our schools can help to address this problem. However, it is up to each one of us in rearing our children and grandchildren, and in our everyday lives, to take increased responsibility for our own behavior and for the informal education of those we interact with.

Fundamental Issues

Our Federal Government spends beyond its means. A number of countries have done this.

I, personally, borrowed money to buy the house that I then lived in for more than 40 years. The amount I borrowed was reasonable in terms of my income at the time. Moreover, I was fortunate enough to have tenure in my University of Oregon teaching position, so my job was relatively secure. After 30 years, my home loan was fully repaid.

Money sense is not easily learned. Many people in elected governmental positions do not seem to have good money sense. They have a propensity to borrow and to spend far beyond the means or the repayment capabilities of the governmental level they help run.

When resources are limited, one can borrow and/or one can make the very hard decisions on ways to limit spending. I strongly believe our educational system needs to do more at all levels to help students learn to more effectively deal with personal, family, business, and governmental fiscal resources.

What You Can Do

Many people in the U.S. spend beyond their means. Many of today's children are growing up in an environment in which it is commonplace, and often both acceptable and expected, to spend beyond one's means. The advertising these children routine encounter helps to create a mindset of "needing," that is "wantings" that people convince themselves they really absolutely need. These things provide instant gratification and so are frequently bought on credit. The high interest rates charged for this credit (especially credit cards) is devastating to many families.

You, personally, can solve this problem for yourself. In addition, if you have children or work with children, you can role model and help teach them personal fiscal responsibility.

Suggested Readings from IAE and Other Publications

You can use Google to search all of the IAE publications. Click here to begin. Then click in the IAE Search box that is provided, insert your search terms, and click on the Search button.

Click here to search the entire collection of IAE Blog entries.

Here are some examples of publications that might interest you.

A Well-intentioned and Very Bad Educational Idea. See http://i-a-e.org/iae-blog/a-well-intentioned-and-very-bad-educational-idea.html.

Deep Insights into Problems with Our Educational System. See http://i-a-e.org/iae-blog/deep-insights-into-problems-with-our-educational-system.html.

National Academic Standards Versus Inequities in Funding Schools. See http://i-a-e.org/iae-blog/national-academic-standards-versus-inequities-in-funding-schools.html.

Open Courseware is Changing the World of Education. See http://i-a-e.org/iae-blog/open-courseware-is-changing-the-world-of-education.html.

Requiring Online Education in Virginia. See http://i-a-e.org/iae-blog/requiring-online-education-in-virginia.html.

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