Nation Put Further at Risk Under Gov’t’s $20-Trillion Debt Load

(Quin Hillyer, Liberty Headlines) As the national debt on Friday hit an immense and record-setting $20 trillion, conservatives and centrists alike are pleading for greater efforts to manage the federal budget.

Marsha Blackburn photo

Marsha Blackburn/Photo by Gage Skidmore (CC)

That same morning in the Washington Post, Maya MacGuineas of the center-right Committee for a Responsible Federal Budget reminded readers that the issues of the debt and the debt ceiling, while obviously related to each other, are two different things – but that the best way to cure both issues is to stop spending so much money.

“Stop adding more to the debt,” she wrote. “With our national debt so high, we need a multitrillion-dollar debt-reduction plan that phases in savings from revenue and entitlement reforms.”

Republican Rep. Marsha Blackburn of Tennessee is one of those who were aghast at the $20 trillion landmark. She said it is time to stop “disregarding the reckless spending that got us here in the first place. Future generations will be shouldered with this heavy burden for years to come unless we fundamentally change the way we think about debt and spending in Washington. The people are tired of all talk and no action. Recently, a group of leading conservatives in the House sent a letter to Speaker Ryan outlining a number of reforms we would like to see enacted in order to bring real reforms and changes to finally address the underlying cause of our spending and debt crisis.”

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The letter contained 19 bullet-pointed suggestions for reining in federal spending. Among them: Requiring significant work requirements for food-stamp recipients modeled on the successful basic-welfare work reforms passed in 1996; a balanced budget amendment; and an end to double-dipping in the federal unemployment insurance program.

The bipartisan group called Fix the Debt explains why this all matters to the average American: “According to the nonpartisan Congressional Budget Office, average income will grow more slowly over the next 30 years with rising debt compared to if debt is placed on a downward path. …Over 30 years of working, it represents $55,000 in lost income.” Not only that, but the pressure the national debt puts on interest rates will mean that an average homeowner will “pay at least $45,000 more over the course of [his] mortgage due to the growing debt.”

That’s $55,000 plus $45,000 – a full $100,000 cost. And that’s just the likely result of future debt. Already—put another way – the debt stands at $62,500 for each of the approximately 320 million people living in the United States today.

Michael Peterson, chairman of the conservative fiscal reform Peter G. Peterson Foundation, noted that the debt burden will require the feds to spend $6 trillion in the next decade on interest alone.

“That’s more than we will invest in our kids. So, in effect, we have decided to spend more on our past than on our future,” he said.

U.S. Sen. Jeff Flake, an economically libertarian budget hawk, has long warned against growing debt and long proposed several pieces of legislation to help solve the problem. One of them would allow taxpayers to designate up to 10 percent of their income taxes to be used exclusively for paying down the national debt.

“If Congress fails make these necessary spending reductions designated by taxpayers, then across-the-board spending cuts would be imposed,” Flake said, in explaining the latter bill. “However, the Debt Buy-Down Act would protect Social Security benefits, benefits for the uniformed services, and payments for net interest from being included in any of these across-the-board cuts. Simply put, in the absence of responsible federal budget solutions, this bill allows taxpayers to take matters into their own hands.”

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The last time the federal budget was balanced or in surplus, meaning no annual deficits were adding to the debt, was in 2001 – the last budget enacted by a Republican Congress that was signed by then-President Bill Clinton. Debt began rising again after the 9/11 terrorist attacks – but it didn’t explode horrendously until Barack Obama was president, when it nearly doubled, from $10.6 trillion to $19.9 trillion.

The balanced budgets in 2000-2001 resulted from significant annual discretionary savings enacted by the early years (1995-97) of the “Gingrich Congress,” plus the hugely successful 1996 welfare reform bill managed in the Senate by later presidential candidate Rick Santorum, plus economic growth spurred by the Gingrich Congress’ successes.

Some in Congress think the successes of the 1990s can be replicated. The bill the House passed this year to replace Obamacare, which failed in the Senate, would have put “work” requirements in the Medicaid program based on the “workfare” provisions of that 1996 welfare reform law. All told, the House bill would have achieved budgetary savings of about $150 billion – a drop in the bucket of the $20 trillion debt, but both a down payment on that debt and a model for further reforms.