Politicians continue to put their interests first in ignoring looming consequences to the massive and growing U.S. national debt, experts on the economy said at a recent forum.
“We are facing the largest, most predictable crisis in U.S. history, and almost nobody is talking about it,” warned Romina Boccia, deputy director of economic policy studies at The Heritage Foundation.
“We need bold leadership,” Boccia said.
“The numbers are really terrifying,” Brian M. Riedl, a senior fellow at the Manhattan Institute, said of the mounting debt that is nearing $20 trillion, adding:
Americans need an alternative to the mainstream media. But this can’t be done alone.
If you just look at nominal dollars, as the CBO sets it, in the next 30 years, the national debt will go from $20 trillion to $92 trillion. That’s the rosy scenario. That assumes no wars, no terrorist attacks, no recessions, and that interest rates stay low.
Boccia and Riedl spoke during a panel discussion, “U.S. Debt: Causes, Costs, and Consequences,” held July 12 at The Heritage Foundation in Washington.
Also on the panel were Michael Tanner, a senior fellow at the Cato Institute, and David Barnes, policy director for Generation Opportunity.
How We Got Here
Panelists pointed to an aging population and political expediency as the two biggest reasons for the out-of-control spending driving the debt increases.
Barnes said lawmakers lack the incentive to prioritize long-term strategies over short-term re-election concerns.
“As long as we, the people, don’t hold lawmakers accountable, we’re never going to get out of this problem, because we prefer to get something today and put off tough decisions,” he said.
Both Tanner and Riedl said that many short-term votes by Congress are a consequence of the electorate’s aging demographics. Politicians are rewarded for protecting entitlement programs, they suggested.
“When I look at the debt, I look at the fact that we are spending more than we take in,” Riedl said. “The reason for that growth, according to CBO? A hundred percent of it is Social Security, health care, and the interest on the debt.”
Why People Should Care
Despite relative silence from Congress on the debt, panelists said, it should be a top priority for lawmakers and their constituents.
“It makes us poorer, to start with. The CBO indicates that young people in the midcentury will have income between $3,000 to $5,000 a year less than they would if this debt didn’t exist,” Tanner said.
“It’s also making us poorer today. Companies look at this mountain of debt and ultimately see it as future taxes, future problems for their borrowing, and they therefore invest less and slow their expansion,” he added.
How to Control Debt
Barnes said dollar-for-dollar spending reductions could be “a start” in addressing the problem.
Related legislation would create mandatory spending cuts to match increases in the debt ceiling. That’s the thrust of the a bill proposed by Sen. Rob Portman, R-Ohio.
“Some broader budget process reforms are needed as well,” Barnes said.
“I think there’s going to have to be some overall cap on the growth rate of debt,” Tanner said. “Something of that nature for overall debt, where debt exceeds X percent of GDP, you can’t spend. That will at least force them to debate the issue.”
Katrina Willis is a member of The Heritage Foundation’s Young Leaders Program.
“We need bold leadership,” Boccia said. Yeah well, we don’t have that, and we never will as long as Congress focuses all their attention on the lobbyists and on fund-raising for the next election.
I agreed with most all the comments until I got down to the part where Barnes said “As long as we, the people, don’t hold lawmakers accountable, we’re never going to get out of this problem, because we prefer to get something today and put off tough decisions.”
At this point, it’s important to separate the ‘we’ from the ‘they’ because ‘we’ the people are ready for some tough decisions, but ‘they’ the politicians aren’t. They prefer passing bad ’Band-Aid’ legislation over actually tackling the problem, and that is cleaning up the fraud in Social Security and Medicare. Clean that up and we have money to pay toward the interest on the debt.
They’ve gotten into this bad habit where a handful of guys will put together a bill that sounds better than it is, then they try to sell it to their fellow Congressmen rather than ask for input up front and actually create good legislation the majority can agree on.
We will never get the people to hold lawmakers accountable, because there are too few people paying attention, and those who are sit on two different sides. Until more of our population wakes up and realizes their input is needed, things will never change.