When Did The United States Start Running A National Debt?

Sometimes you have to look back before looking forward with the national debt issue. So, when did the United States start running a national debt? Let’s take a look.

The truth of the matter is the national debt has been part and parcel of our makeup throughout our history. For all the comments that we “should pay off the debt”, such a goal is unrealistic for a host of reasons. One needs only look at how we used debt to realize that.

So, when did the United States start running a national debt? The answer is an odd one. We started running one before we even became a country. Remember, we were colonies of England first. It was only when we broke away from the King that we became a country. We did this via the Articles of Confederation from a legal perspective. Following the signing of this document, we immediately started borrowing money to pay for the war.

As you well know, we prevailed. We also came out of the American Revolutionary War with a national debt of $75 million. The first date this debt was considered to accrue was 1791. Once the government organized, we began paying it down.

The nature of this initial debt would be a constant feature of our country up to the 1930s. We would incur debts to pay for emergency issues and then pay it down. These emergency issues were almost always wars such as the War of 1812, the Civil War and World War I. Following each of these, we would pay our debt down although we never completely paid it off.

It wasn’t until the 1930s that we permanent started going into debt. This was the period of the Great Depression when the government spent money hand over foot in an attempt to get things rolling again. World War II soon followed and that cost a bundle as well. We first passed the trillion dollar mark under President Reagan. You can see the clock above to see where things stand now.

Although we started running a national debt from our inception, it is really only during the last 40 years that things have started to get out of control. The problem is quickly becoming a crisis, so it will be interesting to see what solutions our political leaders can come up with to deal with it.

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