America Needs Us to Do Something, Now
Too Late Is Sooner than You Think
In 2015, the Congressional Budget Office projected that the national debt would rise modestly to 79% of GDP by this year. Instead, it has rocketed to 100% of GDP and still counting.
This has been a thoroughly bipartisan fiscal disaster. In 2017-18, Trump was President with a Republican Congress. For 2019-20, Democrats controlled the House. Biden and a Democratic Congress governed in 2021-22, with the House turning Republican for 2023-24. Exact mirror images. The parties have failed America equally on this issue.
The responsibility now falls to Republicans again, with much higher stakes. The official CBO projection is now for debt to grow more than 70% (from $30 trillion to $52 trillion) in the next ten years, but that’s way low, as the CBO knows. Its current SWAG on the reconciliation bill now in Congress would bump that to $58 trillion, or about a 90% increase from today. That guess excludes any recession or any interest rise in those 10 years, but dead is dead and broke is broke; why quibble over details?
Cynics suggest that Washington could just borrow or print the money, the Alfred E. Neuman response. We’re way past that. I’ve asked dozens of my friends with investment portfolios what they think of buying 10-year treasuries at 4.3% interest rates. They think I’m joking (or stupid—I prefer joking). A surefire loser—the inflation will more than eat up the interest. Modern Monetary Theorists briefly posited that we could just print the money to pay the nation’s interest bill, but almost no one believes that anymore. Excess money creation=too much money chasing too few goods, i.e., inflation. So again, the bond buyers take the loss. As they insist on higher interest rates to cover this risk, the debt rises further.
America is in fiscal quicksand. The more you struggle, the deeper you sink.
The federal government is becoming the household with too much credit card debt. When the interest swallows all disposable income, you can’t get out.
On current projections, by 2034, interest plus entitlements would consume all federal taxes and levies of all kinds. That leaves $0 for defense, courts, federal highways, regulatory agencies, the FBI, CIA, Secret Service, DEA, energy research, everything. That will happen much sooner with anything resembling the current reconciliation bill.
Five Republicans in the House or the Senate need to put a hold on the pointless tax cuts and push for some spending cuts. That won’t solve the problem—it will only buy time for serious entitlement and tax reform—but at least it will show that someone in the Capitol understands the difference between political “reality” and fiscal reality. It would be a start.
Reach out to your representatives or their staffs, or to someone who might know someone in Washington, or someone with broader influence, or just someone. You’ll never know unless you try.