When’s the Last Time America Didn’t Owe Anyone Money?
The current national debt is $34.5 trillion, which is honestly a hilarious amount of money. Even understanding that we’re working on a global scale here, that’s an absolutely cartoonish amount of money. We may as well be in the hole by a gajillion. The idea of ever bringing that back to zero seems like a lie. My hunch is that most people are betting that we’ll be living in a bombed-out world where the currency is cockroach wings before we ever have to make good on that sort of monetary promise.
At the same time, I’m no gold-standard kook, and I understand that this is a different sort of debt than the one I owe to Chase Bank for a laptop. I’m also not going to go full fiscal fascist and explain that we need to scrap every library and food-stamp program for their copper wiring until we’re in the black. There’s a difference between wealth and liquidity, and that our country lives, like many people vastly richer than me, nestled in the center of a web of things owed to and fro. Seems like a nightmare, but hey, somehow I’m the one with generalized anxiety.
Don't Miss
I was curious, though, when was the last time the United States truly didn’t owe anyone shit? I wasn’t even sure it existed. For all I knew, we’d been on the hook for the value of the tea destroyed in Boston Harbor since we first told England to fuck off. But it turns out we have, indeed, hit net zero on our books before, and we don’t have to go back to the Revolutionary War to find it. It is, though, closer to our founding than it is to this Friday.
As I guessed, we were a country born in debt, since, in order to buy the stuff we needed to kill all those redcoats, we needed to take out loans from countries like France and the Netherlands. The first official figure given for the national debt, in 1783, was $43 million, a figure Jeff Bezos could realistically misplace. This debt grew, thanks in part to first Secretary of the Treasury Alexander Hamilton’s belief in the power of debt, saying, “A national debt, if not excessive, will be to us a national blessing.”
Andrew Jackson did not agree. He had what amounted to a deep personal hatred and shame of the fact that the U.S. was in debt, and he made it his mission to bring the number down to zero, which he accomplished, for the first and only time in U.S. history, in 1835. How did he do it? Well, through a good old-fashioned fire sale of federal lands and the dissolution of national banks. This allowed him to entirely erase the national debt, something that probably would have been a source of pride if it wasn’t immediately followed by a six-year depression that’s also responsible for the birth of the credit rating. Now, the clean debt didn’t cause the depression, that was caused by a real-estate bubble and a drop in the value of cotton, but unfortunately, the two are going to be linked forever.
While railing against the debt, Jackson called it “black magic,” and it seems like it was — at least in the terms that it was an incredibly dangerous thing to fuck with.
