America faces several profound challenges. Most defy easy solutions. And even when an appropriate response is apparent, multinational cooperation is required, as is the case with climate change, migration, weapons proliferation, terrorism and other issues.
On the other hand, budget deficits and the accumulated national debt are within this country’s control. Yet Washington is unwilling to responsibly act. That fact is apparent from figures released Tuesday by the Treasury Department. Over the first four months of this fiscal year, the federal budget deficit soared from $176 billion to $310 billion, a staggering 77 percent increase compared to the same period a year prior.
What’s more, according to the Congressional Budget Office, by 2022 the annual budget deficit is expected to top $1 trillion.
This spike is transpiring not during wartime, or in response to an economic shock or some other legitimate national emergency. Rather, this happened during a time of economic growth, low interest rates and relative peace.
“It is widely agreed that the federal government debt is on an unsustainable path,” Federal Reserve Chairman Jerome Powell told a congressional committee hearing in late February. Congress and President Donald Trump may agree, but they also seem to agree to ignore it, breaking previous patterns of the “out” party suddenly finding fiscal religion.
And if not religion, morality should at least be in play regarding the intergenerational transferring of debt.
“We’re just dumping more and more debt on future generations, which is limiting their economic prospects and their policy choices, so it’s generationally very unfair,” Robert Bixby, executive director of the Concord Coalition, a nonpartisan organization advocating for fiscal responsibility, told an editorial writer.
And the generation equation is exacerbating, with baby boomers in a retirement wave and life expectancy, along with healthcare costs, increasing.
“We’ve really done nothing to prepare for it; in fact, we’ve underprepared in running up our debt and deficits over the last 20 years,” Peter G. Peterson Foundation CEO Michael Peterson told an editorial writer.
Within a decade, according to data from the nonpartisan foundation, mandatory spending and net interest costs will comprise 78 percent of federal spending, leaving just 22 percent as discretionary — although many items in this sum are considered mandatory to key constituencies, too.
The economic, opportunity and moral costs are significant, too.
Spending on net interest costs will soon supersede some other budget essentials like defense and Medicaid spending, which the Peterson Foundation notes could “crowd out important public investments that can fuel economic growth” like education, research and development, and infrastructure, let alone private-sector investments that drive our dynamic economy.
Spiraling spending is certainly a factor, and both parties are part of the problem. Republicans backing a spike in military spending, among other items, and Democrats are pushing for other expenditures, including extensive new spending promises from many of the party’s presidential candidates.
The irresponsible tax cut passed by a GOP-controlled Congress and signed by Trump exacerbated the problem and set up a cynical political trap that makes rectifying the mistake a cudgel in the permanent campaign.
Americans who balance their budgets at kitchen tables deserve real solutions.