Kid Worldview: The Cost of Debt

admin —  July 26, 2011

Image courtesy of Leonardini

By Beth Groh

Oh, that money was rolling in…

Week after week, the bank account was looking better as those paychecks were being deposited—and spending habits were being curbed.

That’s what our teenage daughter has been experiencing this summer, now that she’s working two jobs and learning the art of saving.

But that freshly expanded income stream has opened a new door for her—a chance to fulfill a common teenager dream of buying her OWN CAR.

The only catch?  She would need to borrow a good portion of the money.

Suddenly, a teenager dream required a grown-up calculation:
Which was worth more … The feeling of freedom she would gain by having her own car? Or the loss of freedom to control her spare time by working enough hours to pay for her car?

She came face-to-face with a biblical truth, as explained in Proverbs 22:7 – the “borrower is servant to the lender.”

Her new loan payment would become her “master”—and dictate how much she needed to work in order to pay for the car and other expenses.

In the end, she was willing to make that payment her boss. At least she did so with a full explanation of the trade-offs she was making.

So, thanks to this car issue, a biblical perspective on debt became a kitchen table topic in our family this summer.

Too bad it’s not being discussed that way in our nation’s Capitol!
D-E-B-T.   It’s a dangerous four-letter word in our national vocabulary right now.

By some calculations, each American citizen is on the hook for more than $46,000 in debt—and that’s before the ballooning wave of new benefit programs hits and the aging Baby Boomers strain (drain?) the already stretched Medicare and Social Security programs.

Our national debt has grown an estimated $3.84 billion a day since 2007.

When do we say “enough”?

And when do we, as a nation, turn to God’s Word to see His warnings about debt?

Forget for a moment all the detailed talk about the debt ceiling, the potential impact of our debt on our nation’s credit rating, the debate over raising taxes versus cutting spending or the failure of Congress in the last couple of years to even pass a budget, let alone balance one.

Instead, let’s zero in on the most fundamental issue relating to Proverbs 22:7. If our nation’s leaders continue to spend money that we don’t have, who’s loaning us the money?

Who’s our “master”? China? Japan? Europe?

God’s Word says “all of the above.”

Those who hold our debt, to a large degree, hold our future—our economic and national security.

Say, for example, China invades Taiwan…would we have much influence if they could threaten to sell off all our bonds? If Japan declared a trade war with the U.S.…would we have much leverage if they could flood the market with our Treasury notes?

God warned His chosen people about the dangers of being on the “servant” side of debt in the 15th chapter of Deuteronomy. His blessings would flow out of this promise: “[Y]ou will lend to many nations, but you will not borrow; and you will rule over many nations, but they will not rule over you.”

As our nation continues to amass more debt, we will continue to hand over part of our nation’s sovereignty to those who lend to us.

Even if we “finance the debt ourselves” by printing more dollars, we will all pay for it in the end by shrinking the buying power of each dollar. Ultimately, the most vulnerable in our nation would bear the heaviest burden because their limited dollars would buy fewer goods and services.

God’s Word provides clear guidance on borrowing money—Do so at your own risk, knowing full well that the lender becomes master of the borrower.

Sometimes as individuals we are willing to accept the terms of that agreement. Our daughter was, and is learning a grown-up lesson on responsibility as a result.

As a nation, though, the perils of debt are far more profound.

At minimum, we indenture our children and grandchildren with a financial burden they must someday bear.

At worst, we forego God’s blessings promised in Deuteronomy for nations that avoid the debt trap. And, even more alarmingly, we empower other nations to lord over us, instead of submitting to the Lord’s will for our nation.