God uses the number 40 quite often—it often designates a time of testing. It is mentioned 146 times in the Bible. Examples in the Bible are frequent: The Israelites were 40 years in the wilderness; Jesus and others fasted for 40 days; and Jonah 3:4 shows that God warned Nineveh for 40 days. So what is this anniversary?
On August 15, 1971, President Richard Nixon announced that the United States would no longer convert U.S. dollars to gold. Gold and silver certificate money, which only we older citizens can remember, were then replaced with government-issued coupons with no expiration dates. For the first time since the Civil War, our money had no real value and could be valued based on what traders thought its value might be. It is now known as "fiat money," which is based on confidence in the issuing government.
Gold replaced by printed money
Why was this done? The obvious reason was that the treasury was broke and owed far more in issued money than we had gold in reserve. The surface reason was spending for the war in Vietnam, which had gone on for eight years to no avail, but at a huge expense in money and lost lives. "Great Society" entitlement programs were also beginning to take their toll.
Since money could now be made out of paper and ink, restraints on spending almost disappeared. Unfortunately many politicians pass it out by the bucketful to their supporters so that they can keep getting elected. The result: The amount of money has mushroomed. The national debt in 1971 was $378 billion. 40 years later it is $16 trillion on the surface, and four or five times that in unfunded obligations. It is obvious that we cannot ever repay this debt and looking unlikely that we'll ever recover from the mess. The collapse of our financial system is predicted now by many experts.
An uncertain future
Is this significant? Within a few days of this anniversary date, the rating agency S&P cut the U.S. government debt rating from AAA to AA+ with a negative outlook, the first time in modern history that one of the three main ratings firms has stripped the U.S. of its triple A status. This move puts the rating of the world's biggest economy below Liechtenstein and more than a dozen other countries, and on par with Belgium and New Zealand.
Our founding fathers pledged to sacrifice their "lives, fortunes, and sacred honor" in order to create a better future for their children, grandchildren and future generations. Our recent leaders in many nations have done just the opposite: They are sacrificing the prosperity of future generations in order to have what they want for themselves. Abandoning the financial and honesty principles in God's Word has cost us dearly.
The oncoming financial train wreck is beyond the control of any of us individually. So what can we do? Since we know what the Bible says about the fragility of the world economy, we should prepare ourselves and our families for economic hardship. Plan wisely and save for the rainy days ahead.
God's Kingdom to bring true prosperity
Consider what else Jesus Christ said about money in the Sermon on the Mount: "Lay not up for yourselves treasures upon earth, where moth and rust doth corrupt, and where thieves break through and steal, But lay up for yourselves treasures in heaven, where neither moth nor rust doth corrupt, and where thieves do not break through nor steal" (Matthew 6:19-20).
When Jesus Christ returns, He will fix all of the problems mankind has caused for itself—including economic problems. We should try to live today as He did in His physical existence; He knew that material riches are temporary at best, but having spiritual treasure would endure. Strive for the treasure that will last forever!
If you would like to read more about what the Bible says about proper financial management, please read our free booklet Managing Your Finances today.