In February, the government will again exceed the cap on how much it can legally owe. Government debt has grown by $6 trillion since President Obama took office, and this will be the fifth time he asks Congress to increase the cap.
"I will not have another debate with this Congress over whether or not they should pay the bills that they’ve already racked up through the laws that they passed," the president said last week.
There’s a problem with that statement: Congress does not annually vote on many programs. They are funded automatically.
Tuesday night’s tax vote permanently locked in most of President Bush’s lower tax rates, removing some of the uncertainty that has hurt our economy. There are other good things about the bill, but also plenty to criticize as well.
Either way, the tax debate is over. But the spending half of the fiscal cliff was merely postponed. In two months, automatic spending cuts ("sequestration") will go into effect. We’ll have another crisis. This is the issue on which the president says he won’t negotiate.
Leading Democrats think that the president should help fix our spending problems. "Putting the country on a sustainable fiscal path and bringing our debt under control is incredibly important to our economy and our standing in the world," Sen. Michael Bennet, D-Colo., said last week.
Erskine Bowles, the chief Democrat on the president’s National Commission on Fiscal Responsibility and Reform, said, "I think it’s absolutely clear that the fiscal path we are on is not sustainable, and for me, the best analogy is these deficits are like a cancer, and over time they will destroy the country from within."
For the past several years, we have borrowed about 40 cents of every dollar the government spends. Our current debt is analogous to a person who makes $65,000 a year routinely spending over $100,000 a year and owing almost half a million.
The New York Times columnist David Brooks pointed out last week that "By 2025, entitlement spending and debt payments are projected to suck up all federal revenue. Obligations to the elderly are already squeezing programs for the young and the needy. Those obligations will lead to gigantic living standard declines for future generations."
The International Monetary Fund has calculated that meeting all of our government’s long-term obligations would require an immediate 35 percent increase in all taxes and a 35 percent cut in all government benefits. Yes, it really is that bad. No one denies it in Washington. Both parties know it’s true. But only a few brave souls, like Paul Ryan, have been willing to propose solutions.
It is important to understand that all of this is happening automatically. Budgeted programs like parks and foreign aid are not the problem. In the House, Republicans led by example and cut our own budget two years in a row, but these cuts make little difference to the overall federal budget.
It is "entitlement" or "mandatory" spending that is exploding. Congress does not annually approve this spending, because these programs are supposed to run on their own, like insurance programs. But they don’t. The retirement of the baby boomers, longer life spans, and expensive health care technologies have sent Medicare and Social Security hurtling pell-mell into a spiral of debt. Compared to these programs’ long-term obligations, the price of the recent wars in Iraq and Afghanistan is like a drop in the bucket.
President Obama knows this. On Sept. 9, 2009, when he urged Congress to pass his health care law, he said, "Put simply, our health care problem is our deficit problem." Obamacare then proceeded to make the problem worse, not better.
In 2009, President Obama appointed the Bowles-Simpson Commission to study the problem and make recommendations — recommendations he then ignored.
Congressional conservatives, angry about this, balked at raising the debt limit without a plan to control spending. This produced the "Supercommittee," which, like the commission, was tasked with coming up with a plan. This time, they were given an incentive: If they failed, automatic spending cuts would take place. Well, they failed. On Thursday, Congress voted to postpone those automatic cuts for two more months while we try again.
The problem can be solved. The House has passed a plan to solve it. But no plan can become law without bipartisan support, and that can’t happen without the president’s leadership. He won the tax fight. Now, let’s see if we can win the debt fight together.
U.S. Rep. Joe Pitts represents the 16th Congressional District.
Nothing contained here should be considered as an attempt to aid or hinder the passage of any legislation.
The views expressed here are those of the author and not necessarily those of the Susquehanna Valley Center.