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Since joining Congress this year, Rep. Jim Renacci of Wadsworth and other Republican freshmen in the House of Representatives have made cutting spending and reducing the national debt one of their priorities.
Renacci discussed the need for belt tightening in a video he posted to YouTube on March 29 titled "Congressman Renacci Pledges Fiscal Responsibility."
"The United States is currently more than $14 trillion in the red, which means that our debt is now almost equal to the size of our entire economy," Renacci says in the video. "To put it in context, every child born today inherits a $45,000 share of the national debt before they take their first breath."
That sounds like lots of moolah for a newborn to pay, so PolitiFact decided to check out Renacci’s claim.
According to the U.S. Treasury Department, the nation’s total outstanding public debt is currently $14.3 trillion, up from $14.2 trillion on the day Renacci made his claim. He is correct that the national debt exceeds $14 trillion.
The U.S. Bureau of Economic Statistics estimates the nation’s Gross Domestic Product at $15 trillion in the first quarter of 2011, a number that only slightly exceeds the nation’s debt. So Renacci is also correct that the national debt almost equals the size of the entire economy.
To determine the share of the national debt that would be allotted to each American, we divided the $14.3 trillion national debt by the 2010 Census’s current U.S. population figure of 308.7 million. That comes out to $46,323.29 per person, which is slightly higher than Renacci’s figure.
Based on the information to this point, we ruled this statement True when we originally published this item in May 2011.
Since then, a lot of politicians have made similar statements, resulting in additional fact-checking by our PolitiFact partners. PolitiFact Texas added an extra dimension to the issue by exploring what constitutes the national debt, breaking it down into to parts. We'll borrow from the explanation offered by PolitiFact Texas to explain:
Intragovernmental debt refers to money owed by agencies within government to other agencies -- basically an internal accounting issue. An example: Social Security surpluses that the government uses for other federal operations. Such money will have to be repaid, it’s presumed, but the demand is less pressing right now and it doesn’t affect credit markets.
In contrast, public debt reflects money borrowed from outside sources -- giving it more of a connection to the economy, Josh Gordon, an analyst with the anti-deficit Concord Coalition, told PolitiFact Texas. "If your problem with the national debt is that you think it’s affecting the economy or interest rates or something like that, the only part of the national debt that affects the economy is the debt held by the public. That’s where the (U.S.) Treasury is borrowing money on the open market."
So where does that leave us? Renacci's statement is accurate. The overall debt at the time he made the statement, divided by the population at the time, supports his number. But we know today that the public debt is what the government actually owes to those who have lent it money, and that is a good bit less than the total debt. That's important information that puts Renacci's claim into perspective, and on the Truth-O-Meter, that makes the statement Mostly True.
Rep. Jim Renacci, "Congressman Renacci Pledges Fiscal Responsiblity," posted to YouTube March 29, 2011
Treasury Direct, U.S. Debt to the Penny and Who Owns It, accessed May 4, 2011.
U.S. Bureau of Economic Analysis, Gross Domestic Product: First Quarter 2011 (Advance Estimate), April 28, 2011
U.S. Census Bureau, Population Distribution and Change: 2000 to 2010, March 2011
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