While Rome Burns, The Debt Continues to Rise

by Chuck Donovan

Our so-called “leadership” in Washington, D.C. continues to fake concern for the budget, the defecit, and ObamaCare.  Meanwhile, nobody wants to talk about the two economic elephants in the room – 1. The shameful and deadly national debt, and 2. The ticking economic time bomb of entitlements known as Social Security and Medicare.

Any so-called compromise by our irresponsible central tyrants will add to the already crippling national debt.   The current debt already exceeds 100% of GDP but promises our government has made for future payments will easily increase that debt at least tenfold.  Our interests payments this year alone will be over $400 billion dollars.  That is more than 10% of the non-budget spending taking place this year.  Oh by the way, we are funding those interest payments with – you guessed it – more debt.

The so-called “mandatory” payments to entitlements Social Security and Medicare are soon to exceed spending on all other government expenditures combined.  Remember, these items were not “mandatory” before they were passed.  Just what makes you think they cannot be changed by the whim of our central planners?

Some are demanding a Continuing Resolution (CR) to end the budget “crisis”.  A CR is little more than approval for yet another credit card to be rung up by central rulers who have repeatedly shown their inability to live within realistic limits.  Just who would be dumb enough to hand them another credit card?  Just who would continue to trust these “leaders” to spend our money after the horrific mess they have already created?  The answer to all those questions is “you”.  You will give them another credit card to max out.  You will underwrite their overspending.  You will do it all because you refuse to learn what is really happening with your money in Washington and what really must be done to control the spending of a government that is supposed to be working for you, not the other way around.

Here is the truth about Federal spending.  Even if we completely shut down all Federal operations including Defense, we cannot sustain payments to Social Security and Medicare without radically increasing our national debt.  Just how much of our big spending do we think we can fob off on our grandchildren and great-grandchildren?

It is long past time we had a grown up discussion about money and admitted that we have allowed ourselves to make promises that cannot be kept.  Difficult choices must be made now.  An economic storm is on the near horizon.  Action now might reduce the damage from that coming storm just a little bit.

One more thing we need to grow up and do.  We need to not be so afraid of letting freedom win.

Below are some other sensible perspectives on the issue:

”As President Barack Obama and Congress continue to bicker over passing the federal budget and raising the government’s debt ceiling, a report published by one of the nation’s most credible agencies warns that the U.S. could face economic disaster within 25 years due to excessive government spending.

Obamacare is part of the problem, but so are Medicaid, Medicare, and Social Security.  The cost of these programs will mushroom as tens of millions of baby boomers reach retirement age.

The report was published on Sept. 17 by the nonpartisan Congressional Budget Office.  Its most optimistic forecast shows the federal debt growing to 100% of annual economic output by 2038, from an ‘already quite high 73%’ today.  That would make the U.S. like France, which in terms of fiscal strength is none too good.

But the CBO implicitly concedes that the outcome is likely to be a lot worse than that, and so it included its ‘alternative fiscal scenario,’ which is far more realistic.  It projects the federal debt will grow to 190% of the nation’s annual economic output by 2038.  That would make us worse than Greece today, which has a 27% unemployment rate and periodic bloody riots over its dreadful economic conditions. ” – by Gene Epstein, Barron’s, September 30, 2013, Cover story

From Investor’s Business Daily:

”Shutdown: The government is shut and the sky hasn’t fallen, just as the sequester didn’t invite Armageddon.  It’s time to realize just how much of government can be permanently furloughed.

‘In this present crisis, government is not the solution to our problem; government is the problem,’ Ronald Reagan said after taking the oath of office.

He pointed out that ‘we have piled deficit upon deficit, mortgaging our future and our children’s future for the temporary convenience of the present.’

Sound familiar?  And that was in 1981, when the deficit was under $80 billion, not $1 trillion as today; and the national debt was less than $1 trillion, not $17 trillion.

Government — more of it than ever — remains the problem today, more than it ever has.

But it won’t be long before millions of Americans may want to put on the 2013 equivalent of an ‘I survived Y2K’ T-shirt.  The light bulb might go off when they take a stroll on the National Mall in Washington that the government insists is closed, and discover going for a walk can be done without state supervision.”

”We hear of how most federal agencies are being forced to prioritize because of the shutdown.  But shouldn’t they be doing that when the government is open too?

As Reason’s J.D. Tucille writes, during a shutdown ‘the military stays at its posts, the Post Office keeps losing your mail, Social Security and Medicare continue hemorrhaging money.’ What’s more, the real non-governmental world of the equity markets actually gained a goodly amount on day one of closed-down government.

Government is indeed the problem, as Reagan knew.

In the coming days and weeks we will discover we can do without a whole lot of it — a fact worth emphasizing in an era when nothing is certain except debt and taxes.” – IBD Editorials, 101/2013, http://news.investors.com/ibd-editorials/100113-673339-chicken-little-was-wrong-about-government-shutdown.htm

From Gary Johnson, the most qualified man to run for President in my lifetime:

“A few days ago, I predicted that, when October 1 arrived, President Obama and Congress would make yet another back-room deal to keep the government open while continuing their big-spending ways. I was wrong.

What they did is even worse. They have done NOTHING. They let a costly government pseudo-shutdown happen — inconveniencing Americans from World War II veterans visiting Washington, DC, to millions who simply need to get some information on government websites. Who else in America could get by with such incompetence and neglect without being fired??

…when all is said and done, we will find that this ridiculous political circus will have cost us a great deal of money we don’t have.

…If they are non-essential, why do we have them — especially when facing a $17 trillion debt?

But…whether it is today or next week or whenever, the politicians will somehow get the government doors reopened — and nothing will have changed.”

The games have to end.  And the only way they will end is if we demand it. …STOP playing around and get on with the task of actually shutting down non-essential government programs for good. STOP pretending to care about the deficit and debt while doing NOTHING to reduce them. And STOP funding government programs that are attacking our liberties at every turn, from spying on us to regulating every aspect of our lives to using the tax code as a weapon of force.” – Gary Johnson, Libertarian candidate for U.S. President, 2012

From the greatest political journalist in American history, Garet Garrett:

“War debts and depression debts possess the same character.  All the things needful to conduct a war exist at the time.  So why the fiction of borrowing them from the future?  Why create a debt to represent them?  In the same way, all the things needful to feed and clothe and house the unemployed exist in the present.  Why a fiction of borrowing them from the future?  Why create a debt to represent them?  The reason in both cases is the wish to postpone and avoid payment.  Let others pay.  Let tomorrow pay.  Let the next generation pay.

A war that was charged wholly to its own time, one paid for in full by taxation, would be a very unpopular war.  But it would be a solvent war.  So also with depression.  Every depression hitherto has been paid for at the time.  Such a thing as issuing bonds for relief was almost unknown.  An that is why the recovery, when it came, was always so amazing.  It had no load of debt to drag along’ instead of it a new , unmortgaged future. Now for the first time we are trying to charge a depression to the future, though never before had we been so rich in all the means to pay for it ourselves.” – Garet Garrett, “When Wishes Think,” February 23, 1935

 

 

 

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