Ask an American citizen about the financial status of the U.S. government. He or she would most likely have an awareness of the current debt crisis that afflicts our nation’s government, once thought to be impervious to economic decline. Fewer, however, would be aware of the extent to which the U.S. government bears financial burdens and the ways that the debt crisis impacts us as individuals. Overdraft, a documentary directed by Scott Galloway and sponsored by the Travelers Institute, seeks to explain how government spending shapes our wellbeing and provides potential solutions for reducing the national debt. The propositions offered in this movie prompt Americans to consider the ways that they can enact change to prevent the debt crisis from worsening. According to Overdraft, our current national debt amounts to over $14 trillion, and on our current fiscal path, this total will steadily increase. Several factors are responsible for producing this debt, including unpaid tax cuts, two expensive wars, and the recent economic downturn, which resulted in “the lowest revenues… and highest expenditures as a share of our national income in the past sixty years” (Overdraft). Our government’s lack of foresight in managing the national budget is not solely responsible for the current state of affairs, however. In fact, the recession of 2007-2009 was primarily a product of the collapse of the housing economy, the participants of which include the majority of middle class Americans, those who too freely gave out mortgages to people who couldn’t afford them, and the banks that bought and reaped financial rewards from these mortgages (Overdraft). In short, both the U.S. government and its constituents spent money that they did not have, and once the onset of the economic recession finally hit, we all realized how grave the economic decline in our country had become.
Such irresponsible overspending has already and will continue to result in consequences affecting the daily lives of Americans. As former president Bill Clinton states, “If the debt keeps going up, more and more of our federal tax dollars will be used to pay interest on the debt rather than to invest in our future, through education or technology” (Overdraft). The government’s inability to finance various state-funded obligations has already taken a toll on the welfare of many individuals. Tom Miller and his wife, residents of southern Illinois, were the proud owners of a local pharmacy whose customers were mainly patients eligible for Medicaid. They were forced to give up ownership of their business because the government simply stopped sending them payments for their claims on the fees accrued by their Medicaid customers. It will not be long before lack of funding for many other government entitlement programs affects those who rely on these programs for financial stability.
Nevertheless, we must find ways to reduce federal spending to solve the debt crisis. As explained by Clinton, the only way to a balanced budget is “to cut spending and raise revenues among those who benefited most and can best afford to pay” (Overdraft). In the recent past, many politicians have refrained from making unpopular decisions that require cutting spending for fear that they will lose their constituents’ future vote. Therefore, Americans must be willing to make sacrifices and support political change that will ultimately provide future generations with a financially stable government able to provide for the needs of its citizens. In addition, the particular government departments that account for the highest spending must reevaluate the way that they manage their funds. The U.S. government spends approximately $850 billion on healthcare, which is about twice as much as other developed nations (Overdraft). This exorbitant spending has not, however, reflected a higher standard of healthcare in the U.S. In fact, healthcare providers have a tendency to over-diagnose rather than to focus on delivering better care simply because they want to avoid lawsuits (Overdraft). As a society, we must aim to change our litigious ways to allow doctors to practice medicine freely without worrying about the potential consequences.
In the same way, the issue of reducing the national debt has personally prompted me to consider ways that I can change my current spending and saving habits. Knowing that the government may have to reduce the amount of social security provision to maintain a balanced budget has inspired me to rely on other financial means for retirement savings. Though I have indeed opened a Roth IRA account, I believe that a greater awareness of the state of the economy will allow me to choose the right funds to invest in so that I can maximize profit from this investment. I would also like to make sure that I have enough money to maximize my yearly contribution. To do so, I will plan a budget that allows me to raise an average of $500 a month towards my Roth IRA account. In addition to planning early for my retirement, I believe that paying off any debt that I incur as quickly as possible will be essential to maintaining financial stability. To finance my graduate degree in the next two years, I plan to submit a Free Application for Federal Student Aid (FAFSA) to receive low-interest student loans from the government. Finding employment throughout the duration of my enrollment and right after I graduate will be essential to minimizing extra fees I pay towards interest from school loans.
Overdraft portrays the negative effects that the current national debt crisis will continue to have on the wellbeing of American citizens but gives hope for change. It is not just the responsibility of the politicians in charge of enacting budget cuts or raising revenue but also the responsibility of citizens who can support such change to make an effort towards progress. As individuals, we too can make decisions in our personal lives to be financially responsible and less reliant on programs funded on the government.

Works Cited

Overdraft. Dir. Galloway, Scott. Susie Films, 2012. Film.