The U.S. government now accepts Venmo, for those who would like to volunteer to help pay down the national debt.
That’s in addition to the taxes you pay.
I’ll bet you’re giddy about that.
It’s not really a new thing. For many years, the government has let you donate to the national debt at pay.gov. Apparently, you have had the ability to do so with Venmo for months now. It became known when an NPR reporter recently made a social media post about it.
That shows how often people visit the site to make these contributions.
This is not a scam. Well, other than the unstated premise that your contribution could make a difference.
How much is a trillion?
As I mentioned on a radio program a couple of weeks ago, all we need now is for a multi-trillionaire to step up and the nation’s debt problem would be solved. But, as I sit in front of my computer, I’m being told by search engines that no single person in the world is worth even $1 trillion. Elon Musk is worth just less than half that.
Wikipedia lists 12 companies worth $1 trillion or more, and nine of them are American. But, of course, these exist to make money, not to give it away to the government.
A co-host of the radio show I was on suggested a trillion people could donate $1 each. But, of course, the population of the entire earth is a scant 8.142 billion. If everyone gave a dollar, it wouldn’t get us 1% of the way to $1 trillion, let alone the nearly $37 trillion the government owes.
Which illustrates just how crazy of a math problem the national debt presents.
How many people give?
As odd as it may sound, people actually do voluntarily give money to Washington for the express purpose of paying down the debt. Some put the government in their wills. Treasury Department data show these contributions, stretching back to 1996, have totaled $67.3 million.
That would be a lot if you started a GoFundMe account to help your personal savings account, but it means almost nothing to the money Uncle Sam owes. Various sources say it equals about 20 minutes’ worth of government spending. Poof!
To put it in further perspective, Axios timed itself trying to make “an informal trial Venmo payment” to Uncle Sam. It took 1 minute and 20 seconds to take the process up to the moment where all that remained was to hit “submit.” The publication estimated the government’s debt increased by $4.4 million during that time.
The maximum Venmo payment the system is programmed to receive is one penny shy of $1 million. No matter how fast your fingers can move, you still would lose ground. No matter how much well-meaning people contribute to the debt, they can’t keep up with its never-ceasing accumulation. Over the last 29 years, they haven’t even made a dent in the yearly interest payment, which is expected soon to top $1 trillion.
That time the government paid off all debts
Some experts will tell you it’s not bad for the nation to carry debt. Only one time in the nation’s history did Washington completely pay it all off. That was in 1835, and it led to economic trouble. President Andrew Jackson sold off a lot of public land to make this happen, and that led to a real estate bubble.
As history.com puts it, this, as well as Jackson’s decision not to recharter the national bank, led to “reckless spending and borrowing.”
“Combined with other elements of Jackson’s fiscal policy as well as downturns in foreign economies, these problems led to the Panic of 1837. A bank run and the subsequent depression tanked the U.S. economy and forced the federal government to begin borrowing again.”
It hasn’t stopped since.
Why debt matters today
But if some national debt is good, many experts say it does become a problem when that debt grows faster than the nation’s economic output. A recent report by the Government Accountability Office notes that we’re there.
“Historically, debt has decreased during peacetime and economic expansions. But this pattern has changed in recent decades,” the GAO website says, noting that if current trends continue, the debt will grow twice as fast as the economy by 2047.
In the meantime, the US Debt Clock website calculates that today’s national debt translates into $108,434 (and counting) for every man, woman and child.
Will that be Visa, Mastercard, Apple Pay or Venmo?