I know what it feels like to drown in debt. It wasn’t student loans. I paid those back. It was a much bigger wave of delusion that led to my fall.
Years ago, my business wasn’t growing fast enough to support the income I needed to take home. I kept swinging for the fence, believing the next client, the next opportunity, the next good month would turn things around.
When the money wasn’t there, debt filled the gap.
For a while.
That’s one of the seductive things about debt. It buys time. It lets you keep living as though the problem is solved, when all you’ve really done is push it into the future.
Eventually, my future arrived.
I went bankrupt.
The financial damage was bad enough. The emotional devastation was worse. I had built businesses, advised people about money, supported a family, and considered myself a reasonably smart guy. Yet there I was.
Broke.
It took me years to understand that recovering financially wasn’t enough. I had to change my relationship with money.
I had to learn to want less.
I had to become patient.
Most of all, I had to become grateful.
I started paying attention to the wealth I already possessed: my wife, our children and grandchildren, extended family and friends, great health, and a comfortable middle-class lifestyle.
These weren’t consolation prizes because I had swung for the fence and missed.
They were the prize.
My relationship with money changed. My spending changed. I stopped asking money to prove something about me.
That’s when I became a very wealthy man.
Which brings me, strangely enough, to ancient Sumer.
We have been here before
Sumer emerged in Mesopotamia roughly five thousand years ago, in what is now southern Iraq. The Sumerians built some of humanity’s earliest cities. They developed writing, accounting, contracts, organized government, and sophisticated lending systems.
And debt.
A farmer could suffer a bad harvest and borrow grain. Another bad year could force him to borrow again. Interest accumulated. Eventually he could lose his land, his labor, and, in some circumstances, members of his family to debt bondage.
One indebted farmer wasn’t going to bring down a civilization.
Thousands could.
Mesopotamian rulers eventually recognized a problem. If creditors accumulated too many claims against farmers and families, the financial system could destroy the productive society supporting it.
So rulers periodically proclaimed what historians call “clean slates.” Certain personal and agricultural debts were canceled. People trapped in debt servitude could be released. Property could be restored.
It wasn’t simply charity. The kingdom needed farmers farming, workers working, soldiers serving, and families functioning.
Five thousand years later, we’ve replaced clay tablets with Treasury securities and barley with dollars.
Human nature hasn’t changed nearly as much.
$40 trillion
The gross federal debt of the United States has crossed $40 trillion. Imagine stacking $40 trillion in one-dollar bills.
The pile would rise through the atmosphere, pass the satellites, reach the Moon, return to Earth, and repeat the round trip more than five times. In all, the stack would stretch roughly 2.7 million miles into space. That is what $40 trillion looks like when we give the number physical size.
The number is so large it has almost lost its ability to shock us.
What concerns me more is what’s underneath it.
The federal government spends substantially more than it collects. Interest on the debt has passed $1 trillion a year and now costs more than we spend on defense.
And we aren’t doing this in the middle of another Great Depression or World War.
We’re doing it as normal business.
This isn’t a Republican problem or a Democratic problem. Both parties have participated. Americans like government benefits. We like a powerful military. We like healthcare, Social Security, Medicare, and tax cuts.
We especially like receiving things today and sending part of the bill into tomorrow.
I recognize the behavior.
I used to do it myself.
Debt buys the illusion of time
A nation isn’t a household or a small business. The comparison only goes so far.
The United States controls its currency, taxes the world’s largest economy, and borrows primarily in dollars. I couldn’t print money or issue 30-year bonds to rescue my business.
America can.
But that doesn’t repeal arithmetic.
When spending exceeds revenue, the difference has to come from somewhere. We borrow it. When the debt grows, interest expense grows. That interest becomes another expense requiring revenue or additional borrowing.
Debt buys time.
It doesn’t necessarily buy change.
That was my mistake.
My bankruptcy wasn’t really decided on the day I filed the paperwork. By then, the important decisions had already been made.
I had been borrowing from tomorrow because I wasn’t willing — or wasn’t yet able — to make enough changes today.
Eventually tomorrow showed up.
Can America learn to want less?
Maybe that’s the question underneath our $40 trillion debt.
Not “How do we pay off $40 trillion tomorrow?”
We won’t.
The better question is whether a wealthy society can rediscover the meaning of enough.
Cut foreign aid, and the problem remains.
Eliminate waste and fraud — and we certainly should — and the problem remains.
End unnecessary wars and reduce military spending, and the problem gets smaller but remains.
Tax the wealthy more heavily, and the arithmetic changes, but the long-term problem doesn’t disappear.
Eventually, we arrive at what nobody wants to discuss: where Americans actually spend serious money — Social Security, Medicare, Medicaid, healthcare, defense, interest on the debt, other programs — and the taxes required to support them.
Something eventually has to give.
Ancient rulers could proclaim a clean slate.
America cannot simply cancel $40 trillion in Treasury obligations. Those bonds are assets owned by Americans, retirement funds, banks, insurance companies, the Federal Reserve, and investors around the world. Wiping them away wouldn’t liberate America. It would create another crisis.
Our clean slate has to be different.
It begins with behavior.
The meaning of enough
I don’t look back on my bankruptcy fondly. But I’m grateful for what eventually came from it.
It forced me to confront something bigger than my balance sheet.
How much was enough?
I had spent years chasing more. More business. More income. More growth. More proof that I was succeeding.
There is nothing wrong with ambition. There is nothing wrong with becoming wealthy. There is nothing wrong with borrowing money when that debt creates something productive enough to justify it.
The danger comes when more becomes the answer to everything.
More spending.
More borrowing.
More consumption.
More tomorrow sacrificed to maintain today.
Eventually I discovered that wanting less didn’t make my life smaller.
It made my life bigger.
I became grateful for the woman beside me, the family around me, my friends, my health, the roof over my head, meaningful work, and the privilege of waking up each morning with another day to live.
I had enough.
More than enough.
And that’s when money stopped owning so much of me.
Five thousand years ago, the people of Mesopotamia discovered that excessive debt could bind people so tightly that society itself suffered. We’re still wrestling with the same human problem.
America doesn’t need a Sumerian debt jubilee.
We need something considerably harder.
We need the patience to pay for what we consume, the courage to choose what matters most, and enough gratitude to see how wealthy we already are.
Debt is a useful servant.
It is a terrible master.
I learned that the hard way.
Maybe $40 trillion is America’s opportunity to learn it before we have to.
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