You may remember the panic during the 1990s about the national debt. We had borrowed too much; now we were living beyond our means. The nation was threatened with 'foreclosure'; our credit rating would fall. Money Mart would no longer accept our cheques. This 'overspending' was the basis for cuts to the welfare state, which have never been restored. This logic was pursued by all politicians of the left & right: Democratic & Republican; Conservative, Liberal and NDP.

This logic is also still with us. Check out the U.S. National Debt Clock, which states that today's debt figure is over $8.3 trillion, and thus:

The estimated population of the United States is 298,980,413
so each citizen's share of this debt is $28,069.73.

Another website it's linked to claims:

Our younger generation is being loaded with a historic debt burden, caused by run-away consumptive social spending in the past 30 years - with zero plan by the generation that created it taking the responsibility to pay it off (past claims that total debt was being paid-down are bogus, since total debt increased every year).

Then there's more 'how much each of us owe' info, handily converted into graphs to make it look official. Underpinning this is a troubling concern with who we owe the debt to; a third of it is to foreigners, specifically the Japanese.

The joke's on us

The problems with this argument are legion:

- why is debt owed to 'their' investors any better than to 'our' investors? Will our investors go easier on us? All capitalists demand returns on their investment.
- Social spending is actually responsible for a tiny proportion of the debt. Economists usually give spending figures of 25-40% of GDP, but that includes all government spending, not just 'social' (e.g. military funding).
- debt works entirely different for governments than for individuals. Investors need some place to put liquid capital. Governments do not 'go bankrupt'; certainly not core capitalist ones.
- debt is not apportioned out equally per citizen, chiefly because it does not come from government spending. That's right, you heard me:

The deficit is not the debt

I've always thought the deficit was government annual spending, and its cumulative total was the debt. It's what you'd certainly believe, given the rhetoric about 'our' economy' and 'our' debt. Yet the national debt includes private, corporate debt. That $8 trillion dollars is not government spending of any sort, but debt incurred by private capitalists. As Dick Bryan (Review of Radical Political Economics) argues,

Investment funds raised by corporations in international financial markets are private liabilities, acquired, it can be assumed, in the pursuit of international competitiveness. Those funds are recorded in the national accounts of the nationality attributed to the borrowing party. Once each debt is allocated a nationality, those of the same nationality are aggregated to form “national (private sector) debt.

I dunno... I'd like to see those rich bastards pay us back

It's 'national debt' because the capitalists call it national. Yet it still serves private ends: "there can be no presumption that the national debt will be applied to productive activity within the nation; it may well fund international investment." It's not money that 'we' use. Technically, it's not even ours:

there is no legal sense in which that debt is a national liability (the inability of a company to repay its debt will see that company become insolvent); it is not the legal responsibility of the nation in aggregate.

Yet, through the wizardry of economics, the capitalists and their toadies have managed to convince us it's ours. The reasons seem pretty clear:

Nonetheless, the macroeconomic aggregation of private sector debt into “national debt,” and the attribution of a national significance to that debt figure (that the nation is in debt; living beyond its means), sees national policies of fiscal austerity and tight monetary policy to reduce the national debt burden.

The corporations pay less in taxes. Fewer social supports mean more workers willing to work for less. Governments can shift to military and security spending, creating 'attractive business environments', away from providing their citizens a decent standard of living.

I don't mean to sound conspiratorial here, but I had no idea the debt was a private affair. I assumed it was government spending, an assumption the left & right share. This is a concrete example of how ideology operates. Mix up the figures, come up with this colossal number, and convince people they're somehow responsible for it (through the rhetoric of 'household management', as Stuart Hall called it). Meanwhile conveniently 'leave out' that it's private, corporate debt, and that these fuckers are getting us to subsidize them.

Time for some class war