NATIONAL DEBT

Creative Minds Needed in Congress

In 2009, my then 12-year old son and I were watching a news program about the growing national debt. When it concluded, he turned and asked, “Dad, am I going to have to pay for that?” Yes, Chadd, unless the grown-ups of today start acting like adults, your generation will be the first in American history to inherit a lower standard of living from their parents and grandparents.

For the first time ever, United States Treasuries have been downgraded from AAA rating to AA+, a designation that puts us on par with the credit worthiness of Belgium. What was shocking about this downgrade wasn’t that it happened; it was that everybody saw it coming and still acted shocked.

The reason Congress continues to raise the debt ceiling is because they keep agreeing to borrow money, even though there is no consensus on how to pay it back. As a result, our debt climbs. Individual households know what happens when they borrow above their ability to pay it back. Crisis ensues and hard choices have to be made. Otherwise, bankruptcy and a significant decrease in their standard of living is unavoidable.

As our economy stalls and unemployment remains at record high levels, our ability to pay our debt back diminishes, causing those who would invest in America to decide we’re not a good bet anymore and look elsewhere (like China and India). Our creditors may soon refuse to pay for those programs and liabilities that average Americans have come to rely on, like Social Security, Medicare and more. Then what?

From 2003 to 2008, the Bush Administration ran historic budget deficits, adding $2.4 trillion to our public debt. But now, apparently not learning from the past, the current Administration has made Bush look like a penny-pincher. From 2009 to 2011, over $4 trillion will be added to the national debt. This fiscal irresponsibility is magnified by the fact that Washington has been operating for nearly three years without a budget! Where’s the leadership? No self-respecting business or responsible parent could get away with that – especially if they were spending other people’s money.

With both parties spending at unprecedented rates while presiding over a dwindling tax base, it’s no wonder we are where we are.

In 2010, it took $414 billion to pay interest on our national debt. This is more than we spent on the Departments of Labor, Veterans Affairs, and Education combined. Yet making interest payments produces nothing of value – like jobs. And now we are on pace to run a $1.3 trillion deficit in 2011 – the second largest in US history (the largest being in 2009 and the third largest was in 2010) – meaning these interest payments are going to get higher and higher, gobbling up even more taxpayer money and eating away a sizable share of our national priorities.

The challenge of the next decade will be to elect leaders who will understand that we have to stop borrowing money we can’t afford. Further, we must remove burdensome red tape and incorporate only reasonable regulations that promote entrepreneurial risk, investment, and hiring while still protecting consumers and the environment.

Like a single parent or a small business startup trying to stretch a buck further, we have to put creative minds in office who will grow our economy so that we can keep our commitments to seniors and veterans, provide for our national defense, and preserve the safety net for those truly in need.

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