Where Have All The Deficit-Cutters Gone?

From time to time, both Republicans and Democrats express concern about the out-of-control accumulation of federal debt and the annual federal budget deficit.  Republicans raise the issue when they want to get elected.  Democrats raise the issue when they want to stop the GOP from cutting taxes.

But in reality, and for years now, no one in either party has done anything meaningful about the ever-growing national debt.

debt-limit-history-data-for-web-2013-updated-rjr-chart120largeConsider what’s going on now.  Republicans have been laboring over a tax bill for months, and are supposed to get it through Congress and to President Trump this week.  Of course, tax relief is an easier political sell, as rates paid by various constituencies, and backroom deals, get cut.  But where are we on spending?  Well, the House Republicans apparently want to “temporarily” extend spending for most agencies at current levels, with a $650 million increase in defense spending.  In the Senate, where Democrats hold the balance of power because of the filibuster, Democratic leaders say that we need to have equivalent increases in defense and non-defense spending.  Oh, and there’s this, too:  we’re facing another one of those stupid self-inflicted shutdown points, where some government activity will stop unless a spending bill is signed into law by Friday.

So let’s take stock here.  The House Republicans want to hold spending steady, except for an increase in defense spending — i.e., increase spending.  The Senate Democrats want to increase defense and non-defense spending — i.e., increase spending.  And our elected representatives have conveniently maneuvered themselves into a position where they can say that they need to cut a deal that will no doubt increase spending in order to avoid a partial government shutdown.  And by the way, there is absolutely no sign of the kind of thoughtful review of the thousands of ongoing government programs and subsidies and agencies to determine whether they are truly needed and should be modified or eliminated outright — which is what truly committed and rational deficit-cutters would be trying to accomplish.

Gee . . . I wonder why Congress’ credibility with American voters is so low?

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The Costs Of A Porous Border

We’re learning more about the costs — direct and indirect — of the mass influx of unaccompanied minors and other illegal immigrants across our southwestern border, and the news is becoming more and more concerning.

At a closed-door briefing with members of Congress earlier this week, Department of Homeland Security Secretary Jeh Johnson disclosed some of the direct costs.   According to members of Congress who attended, Johnson said the federal government is spending between $250 and $1,000 per day, per child, to house and feed the minors.  When you are talking about more than 57,000 unaccompanied minors already in the country and needing assistance — and U.S. officials predicting that another 30,000 will cross the border by September — you don’t need a calculator to see that the ongoing and future costs are enormous.

As everyone knows, our federal government is cash-strapped.  Some people may say we’ve been racking up huge budget deficits for years, and these costs will add just a little bit more to those deficits.  That reaction ignores the reality of our financial situation.  Every dollar of our deficit is financed through the issuance of U.S. government bonds and notes.  Do we really want to have to issue more bonds and notes to pay for these services, and pledge the full faith and credit of our country for them?  With our current budget situation, the inescapable reality is that we will be borrowing more in the future to pay the interest on these bonds and notes — which means that we’ll be paying directly out of pocket for our border problems for years to come.

There are indirect costs as well.  The U.S. government can’t house all of these minors on military bases, and already we’re seeing governors and mayors raising questions about whether these minors are coming to their states and communities — where they will need more housing, and food, and medical care, and attention.  Who will pay for it?  The NIMBY (not in my back yard) phenomenon is in full swing.  Pennsylvania’s governor has expressed concern about whether the illegal immigrants have infectious diseases, says there should be enough room on military bases in Texas and Arizona to house them, and wonders how he will pay for the needed services if they are sent to Pennsylvania.  Officials in other states are saying that the federal government has resettled some of the immigrants in their states without providing adequate notice to local authorities.  And officials in cities as far away from the border as New Bedford, Massachusetts are concerned that an influx of impoverished, non-English-speaking immigrants will further strain governmental and school budgets that are already stretched to the breaking point.

Massachusetts sheriff recently said, “we are all border states now.”  There’s some truth to that.  It’s becoming increasingly clear that our porous border is creating huge problems for communities and states across the country.  As we figure out how to deal with these unaccompanied minors, we also need to pay attention to the root cause of the problem — a border that sometimes seems to be little more than a line on a map.  We can’t afford to pay $250 or $1,000 a day to care for every child that crosses illegally into our country, and we also can’t afford the security risks of a border that permits them (and adults, too) to do so.  The Obama Administration and Congress need to figure out how to close that border and do it before the costs and consequences become overwhelming.

Time For Another Crisis!

It’s been at least two weeks since the impending “fiscal cliff” disaster was avoided at the last minute.  That means it’s time for our grossly dysfunctional, leaderless government to stumble into crisis mode, again.

This time, the deadlines are in March and April, and one of the key issues is the debt limit.  The debt limit now stands at $16.4 trillion — that $16,400,000,000,000 — but that staggering sum is not enough for our debt-ridden, spending-obsessed, deficit spending-addicted country.  At a press conference yesterday, President Obama said Republicans should just raise the debt limit, without insisting on spending cuts.  We’re not a “deadbeat nation,” he said, and the full faith and credit of the United States should not be a “bargaining chip.”  If agreement on raising the debt ceiling can’t be reached, he says, Social Security and veterans checks might be delayed.

It seems awfully early in the game to play the Social Security card and scare seniors and veterans.  Unfortunately, they aren’t the only ones who are frightened by another crisis brewing.  This morning, global markets are stalling due to concerns about the debt limit, and the ratings agency Fitch says if the debt ceiling issue isn’t resolved promptly America’s credit rating could drop.

At his press conference, the President said he was willing to talk about spending cuts to stabilize the debt, but that such spending cuts should be discussed separately.  We’ve heard that song before, but cuts never get made, programs never get eliminated, and trillion-dollar deficits go on and on.  For all of his talk, talk, talk, the President has shown no willingness to take the courageous spending reduction steps that truly are needed to get our debt problems under control.  Like Wimpy, the President would rather promise to pay us Tuesday for buying him that hamburger today.  After four years, however, the bill hasn’t been paid, and there is no sign it will be paid.

I think Republicans have concluded that, deep down, President Obama would be perfectly comfortable to let the spending and big deficits continue until he leaves office, and that is exactly what will happen if he isn’t forced to sit down at the table and bargain.  If the Republicans see the debt ceiling as a fail-safe means of forcing some hard negotiations with the President that produce real progress on federal spending and the deficit, the President has only himself to blame.

Proposing A “Secretary Of Business” Is The Last Straw

President Obama wants to be seen as friendly to business.  He’s recently touted the idea of creating a “Secretary of Business” — a new, Cabinet-level position that would “consolidate” different federal agencies that deal with business and trade issues and create “one-stop shopping” for regulatory oversight.

This one proposal, I think, reflects President Obama’s deeply held view of the world — and why I must conclude, regrettably, that he will never truly grapple with our soaring budget deficits and federal debt, which I believe are the two most crucial problems facing our country.

In the President’s view, if business is struggling, we need to create a new government position to address the problem and shuffle existing agencies in a bureaucratic reorganization to try to “streamline” regulations.  His reflexive solution to all issues is new government positions, new government agencies, and new government initiatives.  If he needs to burnish his credentials with the business world, he thinks the proper response to to create a new government regime that shows that he cares.

President Obama has been our President for four years.  He’s seen our economy flounder, witnessed the loss of huge numbers of jobs and the departure of millions of disappointed job-seekers from the job market, watched our deficit and debt skyrocket, and heard complaints about excessive regulatory burdens, crony capitalism, and taxes stifling business investment and growth.  The fact that he nevertheless believes that he would aid business by creating a “Secretary of Business” who would help businessmen navigate through the thicket of federal regulations, and assist companies as they seek federal loans and grants and other assistance, speaks volumes about his fundamental mindset.  He’s not going to change if he’s elected to a second term.

If, like me, you believe that we need to eliminate Cabinet-level positions and federal agencies, not create them, if you believe that we need to reduce federal regulations, not hire new federal employees to assist overwhelmed businessmen in dealing with those regulations, if you believe that we need to cut spending, not maximize opportunities for people to get more federal loans and aid, how can you vote to re-elect President Obama?

Like Federal, Like State

We tend to talk a lot about the federal debt — and for good reason! — but there are reasons for concern on the state level, too.

A recent report on the amount of debt at the level is very sobering.  The report looked at regular debt, the 2013 fiscal year budget gap, outstanding unemployment trust fund loans, unfunded benefit liabilities, and unfunded pension liabilities, and showed that for all of the proud words of the governors who spoke at the Republican and Democratic conventions, many states are drowning in debt.  California is in the worst shape, with a stunning $617 billion in debt, followed by New York ($300 billion), Texas ($287 billion), Illinois ($271 billion) and New Jersey ($258 billion).  Ohio, unfortunately, stands sixth with $239 billion in debt.  The state in the best shape is Vermont, with only $5.8 billion in debt — less than 1/100th of the amount owed by California.

In all, states are laboring under a crushing $4 trillion in debt.  It’s just another reminder that the flood of red ink is found across our country — and that it’s high time we start doing something about it.

A Few Thoughts On The Paul Ryan Pick

I’ve been off the grid, so I didn’t think much about Mitt Romney’s pick of Paul Ryan as his running mate until today.  As we were driving home, Russell, UJ, and I listened to a replay of Meet The Press, which featured the all-too-predictable conservative and liberal shouting match about whether Ryan’s budget plan will gut Medicare and destroy the student loan program — among other issues.

Of course, it’s too much to expect that any political debate these days could be done at a reasonable decibel level, without yelling or over-the-top metaphors.  Nevertheless, I thought the discussion (if you can call it that) itself said something about the selection of Ryan.  Rather than arguing about whether the pick would help Romney politically in this state or with that constituency, the commentators were talking about something of actual substance — the budget, our debt problems, and how we deal with them.  How refreshing it would be if this election actually involved consideration of those crucial, meat-and-potatoes issues, rather than phony, grossly overheated topics like whether the evil Bain Capital caused a woman to die of cancer!

I think our exploding debt is the most important issue we face.  I therefore applaud anything that gets our country to focus on its budget problems and the hard choices we need to make to actually address those problems.  I recognize that my fellow citizens might disagree with my views on how we should address those issues — but that’s what elections are for, aren’t they?  If the selection of Paul Ryan causes President Obama and Mitt Romney to lay out their plans on taxes and spending and the deficit in sharp detail, and the election becomes a referendum on those plans, I think our country would be much better off.

For these reasons, Romney’s selection of Ryan is a positive thing for us all.  I hope we’ll be talking more about Ryan’s budget, and other fiscal issues, until Election Day.  For now I say, let the debate begin — and let’s see if we can’t have that debate in a civilized way, shall we?

Eight Months, And $844,500,000,000 More In The Hole

The Treasury Department has announced that our federal government, in May, racked up a deficit of $124,600,000,000 — $124.6 billion.  That brings the deficit for the first eight months of the October 1 to September 30 fiscal year to $844,500,000,000.  I use the full numbers because the long strings of zeroes better convey the colossal scale of the spending hole that we continue, relentlessly, to dig for ourselves and the Americans of future generations.

The Congressional Budget Office forecasts that this year’s deficit will be $1,170,000, 000,000 — $1.17 trillion.  That breathtakingly huge number comes on the heels of the $1,300,000,000,000 deficit in the last fiscal year.  Our deficits topped $1,000,000,000,000 during each of President Obama’s three years in office.

No rational person can believe such deficits are sustainable or that it is a good idea to go farther into hock without doing anything about it.  Yet that is precisely how our federal government has responded.  Where responsible people would be cutting non-essential programs, reducing payrolls and salaries, developing rational revenue policies, and taking the practical, meaningful steps necessary to bring revenue and spending into balance, our government does . . . nothing.

There’s plenty of blame to go around.  Congress has shirked its responsibility to pass honest budgets and specific spending bills, administrators have wasted tax dollars, and huge segments of the American public have an apparently insatiable appetite for federal benefits and perks.  But I have grown sick to death of President Obama’s constant attempts to dodge his share of the blame for the ignominious failure of the government that he — and he alone — heads.  Successful Presidents are able to lead and work within our political system to deal the issues of the day.  President Obama, in contrast, throws out unrealistic budgets that don’t even receive the votes of members of his own party in Congress and then blames his predecessor — the one who left office more than three years ago — for our mounting debt problems.  Meanwhile, the spending and deficit binge continues.  I don’t view President Obama’s approach as quality leadership.  In fact, I don’t view it as leadership at all — and if a President doesn’t lead, he has failed on the most fundamental part of his job.

Many of us have known people who appeared to live well beyond their means.  We wonder how it can continue, and then, inevitably, the crash comes and the entire house of cards collapses with awful results.  If you’ve seen that scenario, you can’t help but be uneasy about the direction in which our country is heading.  The many zeroes in those trillion-dollar deficit numbers are like the lead weights on the chains binding Marley’s ghost, dragging us slowly and inexorably downward to a fate we fear will be filled with terrible consequences.