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Leadership: Congress stands ready to lift the debt ceiling an additional $1.9 trillion and is eager to waste hundreds of billions more. Do our representatives realize the long-term damage they're doing to the economy?
A topic that would have seemed absurd just a few years ago is now raised openly by investment advisers and some economists: What if the U.S. defaults on its debt? It's not out of the question, given the extraordinary surge of debt-related spending by this Congress and president.
As we've noted, the debt that will be added over the next decade or so will break all records. Indeed, by some recent estimates our debt will surge $13 trillion by 2020, more than twice the total debt accumulated in our nation's first 220 years of existence.
Once approved by Congress, which is inevitable, the new debt ceiling will be $14.3 trillion — roughly equal in size to our entire economy. But why raise the ceiling now, even though the U.S. has only $12.3 trillion in total debt?
As the Associated Press notes, the $14.3 trillion is "enough to keep Congress from having to vote again (to raise the debt ceiling) before the November elections on an issue that is feeding a sense among voters that the government is spending too much and putting future generations under a mountain of debt to do it."
In short, naked politics: Congress can spend like sailors on shore leave while pretending to be "concerned" about deficits and the debt. But it gets worse.
On top of the tranches of new spending for stimulus and bailouts being piled onto our debt, a new study from the Congressional Budget Office says Social Security is going broke — raising the specter of a possible bailout for the retirement program.
The last time this happened, in the early 1980s, the Greenspan Commission raised taxes sharply on working Americans to keep Social Security solvent. Any chance Americans will sit still for another sharp tax hike this time around? Don't count on it.
The elephant in the room, Medicare, likewise is expected to go bust in 2016. Then our fiscal woes really begin. At some point, young, working Americans will simply reject the fiscal pain imposed on them by an impecunious older generation. What then?
As Pimco economist Anthony Crescenzi wrote this week, "Estimates are that the U.S. budget deficit, which in fiscal year 2009 was $1.4 trillion, or 9.9% of (U.S. GDP), will stay high for many years, running around 4% or 5% of GDP in 2015 when (retiring baby boomers)... accelerate the increase in entitlement spending."
On Day One of his vow to take "meaningful steps to rein in our debt," Barack Obama asked Congress to freeze portions of discretionary domestic spending. This would follow an astonishing permanent expansion: Republicans on the House Budget Committee say appropriations bills Obama has signed, along ...
Fiscal Policy: Too many of those pain-in-the-neck productive people living in your state, making everyone else look bad? Want to get rid of them? Let the Garden State show you how it's done through the tax code. At one time in the not-too-distant past, New Jersey was by some measures the ...
A friend of mine once had a Toyota that wouldn't die. The odometer had only a dim recollection of passing 100,000 miles, the body was dinged and the paint was faded and the interior was worn, but the thing just kept running. He finally parked it at the airport, removed the plates and walked away. ...
Uprising: Scott Brown got his demand to be sworn in early as the 41st Republican senator, and elected officials everywhere — Democrat and Republican — will soon find out how much has changed. It was insult added to injury. Sen. Scott Brown, R-Mass., not only gets the late Teddy ...
'I am not an ideologue," protested President Obama at a gathering with Republican House members last week. Perhaps, but he does have a tenacious commitment to a set of political convictions. Compare his 2010 State of the Union with his first address to Congress a year earlier. The consistency is ...
Posted By: Serfdumb(520) on 2/4/2010 | 11:50 PM ET
Perhaps the bankrupting of America is actually the plan of the George Soros funded democrat radicals in charge. The steady destruction of our borders, security and culture is happening on all fronts and are not unrelated events [see Soros article at canadafreepress.com] In The Age of Fallibility, Soros writes, "The main obstacle to a stable and just world order is the United States" and in 2003 declared 'It is necessary to "?puncture the bubble of American supremacy' - our own velvet revol'n.
Posted By: jpdwn(40) on 2/4/2010 | 11:27 PM ET
I think the answer to your opening question is "yes".
Posted By: breakthebank(145) on 2/4/2010 | 8:16 PM ET
Woo Hoo, were getting closer! Soon we can begin to turn America around. Why would we want to stop at 73% of GDP when there's 83%, its just another rain forest of dollars. Besides just who is going to rebel, and against who? And as Congress figured out in the seventies, its not like any other country can collect.
Posted By: ajmc(745) on 2/4/2010 | 7:33 PM ET
Great column; too bad it falls on the deaf ears of the WH, Congress, & the media. Members of Congress face a conflict of interest. Congression is full of humming-gators, members who chirp about fiscal restraint, but with the jaws determined to devour huge sums of money for pet home-state projects. Factor in not having to pay SS, free health-care, franking privileges, a cush retirement, etc., & you realize they are removed from the reality of Main Street America - Carpetbaggers & Scalawegs!
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