ANOTHER $20 TRILLION
Someday, I hope to bring you good news about the national debt. Unfortunately, today is not it.
On Wednesday, the Congressional Budget Office released its latest projections, and it’s not pretty. The national debt, currently $31.46 trillion, will grow to $52 trillion between now and the end of fiscal year 2033.
That’s more than $20 trillion, or about $2 trillion a year. A few decades ago, $1 trillion deficits were hard to imagine. Now they are half the norm.
We are witnessing an acceleration of a process that was already accelerating. The debt at the beginning of 2000 was less than $5.8 trillion. In just 23 years, it’s grown more than five times as large.
How big is the debt getting? The country’s population was about 334.4 million as of Wednesday afternoon, according to the U.S. Census Bureau. Divide that into $31.46 trillion, and that’s more than $94,000 for every American man, woman and child.
If anything, the CBO’S estimates are almost certainly on the low side. The agency assumes there will be no more major spending packages between now and 2033, and that the 2017 tax cuts, set to expire, will do so.
Both seem unlikely. Other things happen that CBO can’t anticipate, or at least doesn’t, which is why its current estimate is $3 trillion higher than it was last May.
Consider what’s happened the past few years: trillions during the pandemic; a major infrastructure package; student loan forgiveness; Russia’s invasion of Ukraine; and new health services for combat veterans exposed to toxic burn pits. Arguments can be made for all these expenses, but, regardless, they haven’t been paid for. Rising interest rates will increase the debt, too. In fact, the government will spend $10.5 trillion over this time period on interest payments alone.
Meanwhile, there’s been no major windfall to shore up the other side of the balance sheet, and certainly no responsible actions by lawmakers.
That’s not all. Within the next decade or so, three major federal trust funds – the Highway Trust Fund, Medicare Hospital Insurance, and Social Security Old-age and Survivors Insurance – will be insolvent. The CBO says the Social Security trust fund will be empty by 2033; the fund’s trustees say it will happen in 2035. Whenever it happens, the system will be funded entirely by current taxes with no reserves to help. If nothing else is done, benefits would have to shrink by 23% – unless, of course, lawmakers simply pile on more debt.
Currently the $31.46 trillion debt isn’t rising because the government has reached its debt ceiling. That’s good news, right?
Not really. The Treasury Department is merely shifting money around – the equivalent of you and me playing credit card roulette. It still has the same obligations.
Bills eventually come due. It’s not certain exactly when the Treasury Department can stop playing its games, but it must eventually do so this year.
Ultimately, the problem can only be solved at the national level the same way it would be solved around the kitchen table. A family would have to cut some of its spending while increasing its revenues, and then have the discipline to follow through. The same is true for the government. With these kinds of deficits, there’s no way to do this pain free. Taxes will have to be increased, and government programs, including the popular ones, will have to be cut.
The problem, of course, is that lawmakers don’t get re-elected by doing these things – or at least, they’re convinced they won’t be. Democrats refuse to cut spending and often increase it. Republicans often do, too, and they also refuse to raise taxes, which many Democrats don’t want to do, either.
What can average citizens do? Vote for the most fiscally responsible candidates on the ballot, for one. We also can communicate with our elected representatives between elections. If you see Sens. John Boozman or Tom Cotton, or Reps. Rick Crawford, French Hill, Steve Womack or Bruce Westerman, tell them you want them to make the difficult choices necessary to balance the budget.
If enough of us did that, it might make it easier for them to cast those tough, kitchen table votes.
Let’s give it a shot. I’d like to share some good news on this subject – for a change.
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