Another week, another vote in the Senate. This time its to increase Americas debt limit by a whopping $1.9 trillion to a grand total of $14.3 trillion. To help solve Americas debt problem, the Administration has proposed that a bi-partisan commission take the next 10 months to come up with solutions to our budgetary mess. However, the details leave much to be desired, as the commission will likely just end up passing the buck, leaving us in a similar spending predicament. Real reform requires direct Congressional action to tackle the unrestrained discretionary and entitlement spending.
This past year government spending exploded to nearly 26% of the economy well over the 20% historical average including a staggering deficit of $1.4 trillion, or nearly 10 percent of Gross Domestic Product (GDP). To make matters worse, due to rising costs in Social Security, Medicare and Medicaid, federal spending will cause the debt to grow to 300% of the economy by 2050. In total, the entitlement programs have promised $45 trillion more in benefits than the country can afford to pay. Raising taxes to fund these benefits would require an additional $12,072 per household by 2050, which would create a tremendous burden on families and future generations. By 2052, the entitlement programs will consume the entire federal budget, so cutting back on other government spending wont leave enough to pay for the programs.
The White House has announced the creation of an executive commission to offer policy recommendations to help curtail the debt. However, such a commission would have no teeth to tackle surging entitlement spending and would merely remove the imminent pressure on Congress or the President to take action. Furthermore, as The Heritage Foundations Stuart Butler explains, the commission would be inherently flawed and ineffective: The commissioners would be chosen from a pool of potentially lame duck Members of Congress, with a report due after the election and recommendations to be crammed through and voted on by the end of the year in a lame duck session. He also points out that such a panel virtually guarantees a backroom processreminiscent of the Andrews Air Force Base commissions in which a handful of political leaders nail down an agreement behind closed doors and then muscle it through Congress.
The real way to curb the growing deficit is simple cut spending. Quick-acting budget cuts would involve canceling TARP, capping discretionary spending growth (which has increased by 25% over the last three years), and returning to federal spending levels of just a decade ago. Then, Congress must own up to the governments long-term obligations for Social Security, Medicare, and Medicaid benefits, which total $45 trillion. Currently these programs are permitted to grow on auto-pilot without any consideration for the threat they pose to our nations financial future. Instead, these programs should be put on long-term budgets that would be re-assessed regularly so that changes in program spending can be made when needed.