As our federal deficit crosses the $16 trillion mark, we have to stop and ask ourselves if we want to have less from government and lower taxes, or more from government and higher taxes.
We the American people have not done our part to demand responsibility from the people we choose as political leaders. The threat to our nation is not from Iran or China or Putin. It’s from within.
Let’s take a historical look at our federal deficit. From the founding of our nation to 2001, we amassed $5 trillion in debt over more than 200 years. Then former President George W. Bush came in and went from $5 trillion to $12 trillion over the next eight years. Then Pres. Obama in just 3 years took our debt from $12 trillion to $16 trillion.
What does that mean to your own life?
For starters, we have the fiscal cliff coming up later this year, when we’ll hopefully deal with the current deficit and our nation’s long-term structural deficit. If it isn’t dealt with, we go straight into a serious recession because of the failure to act by politicians of both parties. They’ve brought us to the precipice of this cliff that may or may not be addressed in a lame duck session of Congress after the election.
For our kids, it has more far-reaching effects. We have enjoyed a position of preeminence in economics, military matters, and as a political beacon of hope to the whole globe. But maintaining that status requires we only spend what we bring in.
You know the consequences in your own life with those who spend to exhaustion.
I saw a chart from the Congressional Budget Office that shows what will happen to us decade by decade if we continue on our current fiscal path. As you go through the decades, you reach a point where our obligations for Medicare, Medicaid, and Social Security will exceed the entire tax digest of the U.S. — just to pay for those three things!
So we’ve got this current deficit that is silly, uncalled for, ridiculous. It does not matter which party is in power in the White House or anywhere else. As they slug it out, nobody’s watching out for your kids in the U.S.
Our current level of spending is not sustainable. It will either lead to financial bankruptcy, or breaking promises like Social Security, or our promises of medical care.
We either have to reduce spending and keep taxes where they are. Or we give everybody all the entitlements and raise taxes. Or we muddle through somewhere in between. But one thing we cannot do is continue on the trendline of spending we have now.
And don’t think economic growth alone can solve this. It can’t. Because demographics are destiny. We have an aging population with fewer and fewer workers supporting a larger and larger grey generation. The math cannot meet with the promises made today at the current levels of taxation we have today.
Again, do we want to have less from government and lower taxes, or more from government and higher taxes?