Debt crisis rises. | Pexels

On Feb. 7, Praxis invited Ivan Pon­gracic Sr., father of eco­nomics pro­fessor Ivan Pon­gracic, to lecture on the debt crisis in the United States. Over 60 stu­dents and faculty gathered in Dow A to hear his lecture.

Junior Alex Taylor, pres­ident of Praxis, said he appre­ciated hearing about the elder Pongracic’s expe­rience with over­spending gov­ern­ments.


“Its really cool to bring in someone who has real expe­rience in gov­ern­ments that are spending a lot and have the levels of debt that we are coming up on, to share his own expe­ri­ences and how they may soon apply to the United States gov­ernment,” Taylor said.


According to Pon­gracic, the United States’ $20.6 trillion of debt is a ball-and-chain on the ankles of future Amer­icans, which only a massive reduction in spending can cut. Recent mis­cal­cu­lated reports from General Electric Co., Enron, and WorldCom lead Pon­gracic to believe that the feds incen­tivize com­panies “cook their books” in order to increase GDP, and, therefore, increase general optimism about the state of the economy. Not only is the United States digging its own grave, but it’s also hiding it from the American people.


Further, he claimed the Federal Reserve and its 3 million pages of reg­u­la­tions con­tributes to the debt problem by arti­fi­cially low­ering the interest rate from its natural 4 to 5 percent rate.


It cur­rently hovers around the 2 percent mark.


“Reality will hit you sooner or later,” Pon­gracic said. “Money created out of thin air soon dis­ap­pears into thin air.”


The U.S. dollar is the World Reserve Cur­rency. If the Federal Reserve hyper­in­flates the dollar to pay off the debt, the strength of the U.S. and world economies will be at stake. Pon­gracic said that hyper­in­flation in coun­tries like Yugoslavia, Zim­babwe, and Germany gave rise to oppressive regimes, trig­gered wars, and ini­tiated ethnic cleansing.


The Pon­gracics directly wit­nessed these results: Pongracic’s father was put in prison for speaking against the gov­ernment, and his uncle was killed by police after being thrown from the top of a church.


Pon­gracic was born in Zagreb, Yugoslavia, in 1943 under fascism, before com­munism took over in 1945. He never joined a political party, but was able to see into the system through his auditing job. Pon­gracic earned a degree from the Uni­versity of Zagreb in 1968. He then worked on auditing the government’s budget throughout the 1970s, during a period of stag­gering inflation: within the 14 years he worked in the gov­ernment, his monthly pay­checks soard from 14,000 dinars (around $8,700) to 1.5 million dinars (just under $1 million).


The Pon­gracic family emi­grated to the United States in 1984 after the elder Pon­gracic lied to his boss, saying that he was moving tem­porarily to attend college. Instead, he and his family remained in the United States. The elder Pon­gracic studied with the late Russell Kirk, an American con­ser­v­ative and his­torian. Pon­gracic earned his master’s in eco­nomics from Inter­na­tional College in 1986. The family earned cit­i­zenship in 1999.


Pon­gracic taught History of Eco­nomic Thought and Money and Banking at Indiana Wes­leyan Uni­versity from 1986 until retiring in 2013.


Ivan Pon­gracic Jr., an eco­nomics pro­fessor at the college, said his father was inspired to move to the United States based on the indi­vid­u­alism depicted in American pop culture.


“One common theme to those western movies was self-reliance and rugged indi­vid­u­alism. He really thought that that’s the way Amer­icans were,” Pon­gracic Jr., said. “That’s what he admired and that’s what he wanted to be a part of, and it was dis­ap­pointing to find that in fact there are so many Amer­icans that are not into that at all.”