Here are a pair of numbers that might be a bit difficult to digest after many of us have gorged on turkey and dressing: Uncle Sam's federal debt now stands at about $8.5 trillion, and is projected to grow to $11.6 trillion by 2011.
Numbers that big are vague abstractions to us, but if the federal debt is allowed to keep growing at that rate, we'll have very tangible consequences for our nation's economic health. The World Economic Forum, in its annual ranking of global competitiveness, recently downgraded the United States from first to sixth, a demotion attributed to our poor handling of public finances. Think of it as a bloated budget that must be put on a fiscal reducing plan.
As anyone fighting a bulging waistline knows, sooner is better than later when it comes to slimming down. This is especially the case now, since the wave of retirements from the baby boom generation will put added strains on Medicare and Social Security a budgetary time bomb that keeps ticking away with no apparent sense of alarm in Washington.
We're calling attention to this sobering state of affairs now because Sen. Kent Conrad, D-N.D., who has been warning about the insidious damage of budget deficits for years, will soon regain his seat as chairman of the Senate Budget Committee, where he will play a key role in working to bring spending and taxing back in balance. He recently met with Treasury Secretary Henry Paulson to talk about the nation's economic challenges and the urgent need to cut the deficit and debt. We hope this is the start of productive, bipartisan efforts to restore reality to budgeting.
The public debt is the result of accumulated budget deficits, which keep piling up year after year. As Conrad tirelessly keeps reminding us, much of the soaring federal debt is borrowed from foreign investors. The United States government accounts for more than 65 percent -- almost two-thirds -- of world borrowing by country, according to figures from the International Monetary Fund. Along with our dependence on foreign oil, the nations dependence on foreign creditors saps our strength. Fortunately, the U.S. economy remains a marvel of innovation and competitiveness. And public debt, as a portion of the economy, is lower than at other times in our history.
But the trend lines, many of them drawn with red ink, demand serious attention, from both parties and from both the executive and legislative branches.