| The Borrower is Servant to the Lender By Stephen M. Studdert In the first chapter of the Book of Proverbs is a promise: ” But whoso hearkeneth unto me shall dwell safely, and shall be quiet from fear of evil.” (Proverbs 1:33). And then a warning , ” The rich ruleth over the poor, and the borrower is servant to the lender .” (Proverbs 22:7) Today, America is the servant to the lender. And you and I are the indentured servants of staggering debt. Total U.S. government current debt now stands at an estimated $11 trillion. If future liabilities such as Social Security, Medicare and government pensions are included, America ‘s total federal government debt would reach to an estimated and incomprehensible $75 trillion – exceeding the gross domestic product of the entire world. Warning signs of excessive national debt and the disastrous consequences have been evident yet broadly ignored for years, although this is just what I predicted in my book America in Danger . Today America is dependent upon foreign credit to pay its bills, adding debt upon debt, until our nation is mortgaged to the hilt. But as the U.S. fiscal condition worsens, t he appetite of foreign buyers to continue buying trillions of U.S. debt is becoming increasingly tenuous. Household net worth in America dropped by an astonishing $11.2 trillion in 2008. Last year the S&P 500 Index fell $4.8 trillion, the biggest percent loss since 1937 and the largest ever in dollar terms. Governments estimate that up to 45 percent of the world’s wealth has been destroyed by the global credit crisis – in little less than a year and a half. This is unprecedented in our lifetime. At the same time, we continue to heap on the debt. Household debt in the United States has soared from about 20 percent of income in 1946 to 130 percent of income today. Our federal government has run budget deficits in 43 of the past 48 years, and this year our elected national leaders have presented the most remarkable, and I b elie ve irresponsible, budget in history, breaking every record in the process. After 2009 left us with a deficit of an astounding $1.2 trillion (and that was before taking into consideration the full costs of the war in Iraq and Afghanistan ) , the 2010 budget predicts a federal deficit of $1.75 trillion – half of the entire 2010 budget is debt. But the picture is really far worse. According to the “2008 Financial Report of the United States Government” prepared by the U.S. Department of Treasury, the true 2008 federal budget deficit, for example, was $5.1 trillion, not the $455 billion previously reported by the Congressional Budget Office and accomplished by accounting slight of hand. Each year the director of national intelligence submits to Congress an annual threat assessment representing the findings of all 16 U.S. intelligence agencies. The 2009 report was presented last week, and we should be very concerned that while security in Pakistan and Afghanistan has deteriorated and Iran and North Korea are increasing nuclear threats, they deem the larger national security concern to be financial. “The financial crisis and global recession are likely to produce a wave of economic crises in emerging market nations over the next year,” said the report. “Time is our greatest threat. The longer it takes for the recovery to begin, the greater the likelihood of serious damage to U.S. strategic interests,” the report continued. Fully one quarter of countries have already experienced instability linked to the economy, and many are threatening harmful trade wars. In the United States we have lost more than 3.5 million jobs since the beginning of this recession, and some experts expect the U.S. economy to lose 3 million jobs this year. “2008 was an annus horribilis — a truly horrible year that only a sadist could look back upon with pleasure,” said Dallas Federal Reserve Bank President Richard Fisher. Legendary investor George Soros expressed similar sentiment recently, saying: “We witnessed the collapse of the financial system. It was placed on life support, and it’s still on life support. There’s no sign that we are anywhere near a bottom.” They are not alone in these cataclysmic views. Former Federal Reserve chairman Paul Volker, now a senior economic advisor to President Barack Obama, is equally concerned. “I don’t remember any time, maybe even in the Great Depression, when things went down quite so fast, quite so uniformly around the world,” Volcker said. Several years ago the #1 most popular song was entitled “Don’t Worry, Be Happy.” I’d love to sing that song now, but alas there are so many things about which to be rightfully concerned. Indeed, prudence requires that we be ever more attentive and vigilant. There is another pleasant tune the children often sing in Primary, one we should all wisely heed. It’s entitled, “Follow the Prophet”, and ends with the simple yet inspiring refrain, “Follow the prophet, he knows the way.” President Ezra Taft Benson said, “Satan is anxious to neutralize the inspired counsel of the prophet and hence keep the priesthood off balance, ineffective, and inert. He does this through diverse means, including the use of perverse reasoning.” While the world, through that very use of “perverse reasoning”, entices us into more and more personal and government debt, Prophets of God counsel just the opposite. Speaking to the general priesthood of the Church, President Gordon B. Hinckley said: “I urge you, brethren, to look to the condition of your finances. I urge you to be modest in your expenditures; discipline yourselves in your purchases to avoid debt to the extent possible. Pay off debt as quickly as you can, and free yourselves from bondage.” And he concluded with these sober words: “That’s all I have to say about it, but I wish to say it with all the emphasis of which I am capable.” President Thomas S. Monson too has counseled: “Many more people could ride out the storm-tossed waves in their economic lives if they had their . . . supply of food . . . and were debt-free. Today we find that many have followed this counsel in reverse: they have at least a year’s supply of debt and are food-free.” In these difficult days of personal, family, and global turbulence, even as our government leaders pilot our nation toward what I b elie ve is inevitable national bankruptcy, the path for those who follow the Prophet is clear and filled with assured hope and peaceful promise. Our times may be much like those described by the Apostle Paul: “We are troubled on every side.” Yet as we follow the Prophet, we can also say as did Paul: “W e are perplexed, but not in despair .” (2 Corinthians 4:8) “The principles of living greatly include the capacity to face trouble with courage, disappointment with cheerfulness, and trial with humility,” said President Monson. No Comments | Post or read comments FEATURES |
May 22, 2026
May 22, 2026
