Our nation’s total national debt currently stands at $20.5 trillion dollars, which is slightly larger than the entire economy of the United States at 106% of our Gross Domestic Product (GDP). Worse, the Congressional Budget Office (CBO) expects that twenty trillion figure to increase by 50% to thirty trillion within just ten years.
In case anyone thinks this is “business as usual,” outgoing Federal Reserve chair Janet Yellen—hardly known for hyperbole—had this to say about the situation to Congress last November: “It’s the type of thing that should keep people awake at night.”
In order to fix this situation, everything needs to be “on the table.” No sacred cows, no special pork, no privileged entitlements. We need to look at every single aspect of federal spending (do we really need to be giving these particular taxpayer funds away?) and every aspect of the federal tax code (is there any possible way to close this particular loophole?) in order to achieve deficit reduction.
The federal government needs to set and achieve a clear fiscal goal of placing the debt on a clear and sustainable downward path for the long term. There are three fundamental reasons for this:
1. Solvency. There’s really no such thing as “federal funds.” The government doesn’t make a dime of their own money. It’s all taxpayer money. Your money. My money. The money of every American who pays (or has paid) taxes during his or her life. Yet the government goes through it like no one had to work long, hard hours for it. They give it away every election cycle like Santa Claus in an attempt to buy votes from short-sighted constituents who only care about getting something for nothing. But anyone who’s ever had to adhere to a family budget knows you can’t just continue spending beyond your means—at some point all bills come due. And that point is now. If we don’t own this problem and take steps toward solving it—now—we’re no better than Congress, continually kicking the can down the road. And this can-kicking will lead to two existential threats to our nation…
2. Sustainability. We’ve heard it so often it’s become a cliché, but if we don’t bite the bullet and tackle this head on, we’re guaranteeing a life of misery and poverty for our children and their children. This level of spending is notsustainable. We’re so used to being “top dog” in the world that many Americans can’t imagine the very real possibility that the U.S. is on a glide path to becoming a semi-failed-state like Greece, only several orders of magnitude worse. And it won’t be too long before this glide path becomes a virtual death spiral, leaving us wide open to something that makes the current external influence seem like child’s play…
3. Security. A broke nation is an unsecured nation. Not just because it cannot afford to adequately defend itself, but because a broke nation is a beholden nation. If we continue to spend ourselves into the poorhouse it won’t be long before other actors swoop in to pick our bones. If we continue on the path to becoming a mega-Greece, there are a couple of possible outcomes: If we’re deemed “too big to fail” by other Western economic powers, we’ll have to make huge promises and accommodations in order to receive a bail-out. Or if they decide they don’t want to go down with the ship, they’ll sit back and watch as we founder then they’ll start the salvage operation. Either way, we’ll have lost the ability to drive our own destiny—something that’s always been one of the key components to the American Dream.
So what’s the solution? It would be easy for me to take a status quo stance and say that I support a balanced budget. That makes a nice sound bite but it means nothing, and more importantly it does nothing to fix the problem.
Simply put, we need a new budgeting process. We can no longer afford to be buying votes with the lavish distribution of taxpayer money and loading every bill with pork designed to grease the palms of other members of Congress in a “you scratch my back and I’ll scratch yours” paradigm. Congress needs a budget process that will produce timely, responsible, and definitive budgets. More importantly the process must actually reinforce the practice of governing, just as the 1974 Congressional Budget Act (CBA) intended. This requires procedures that strengthen the legal impetus to no longer aim for the goal of being a debtor nation.
If I’m elected, one of my top priorities will be to work with my fellow leaders in Washington—in a calm, competent, bi-partisan manner—to draft legislation to rectify this growing threat to America’s solvency and security.
Deep down, every American knows we face a moment of truth once again. We’ve always found the courage to do right by our children’s future, and we can’t overlook or ignore the fiscal debt impact any longer. Regardless of party affiliation we have a duty to keep the promise of America to give our children and grandchildren a better life.