The Federal Budget
America cannot be great if we go broke. Our businesses will not be able to grow and create jobs, and our workers will not be able to compete successfully for the jobs of the future without a plan to get this crushing debt burden off our backs.
-The President’s National Commission on Fiscal Responsibility
Our federal budget has been in the red continually since 2002. The budget deficit grew from $5 trillion to $10 trillion in 8 years under President Bush. Under President Obama it has grown from $10 trillion to $15 trillion in just three years: a growth rate that is unsustainable. Showdown after showdown in Washington has brought us to the edge of default and given us a credit downgrade for the first time in our country’s history. Both political parties have played a role in that.
The drivers of our debt are federal entitlement programs. These programs must be redesigned to fit the modern era. The Simpson-Bowles plan and Ryan-Wyden plan both have bi-partisan support. We must take the best these plans have to offer and adopt an “all of the above” approach to getting our fiscal house in order.
Here are three ideas that must be part of the conversation going forward in order to get us back in the black:
- Adopt the “Chilean Model” for Social Security, which creates individual social security accounts. We can end the days of politicians using our own hard-earned money to bribe and scare us.
- Customize Medicaid and countless other federal spending programs that aid low-income families: We can accomplish this by allowing the states to collect the needed revenue to run their own programs. Programs designed and managed by state and local agencies stand a better chance of being effective.
- Create a more competitive environment for Medicare: In order for Medicare to be sustainable, we must have tort reform, the ability to buy health insurance across state lines, thus increasing competition. Medicare, along with other entitlement programs, must be means tested.
Of course, defense spending must be given rigorous scrutiny, as well. We must, however, resist giving ourselves a peace dividend today at the expense of our safety tomorrow. Defense spending must reflect the fact that the overseas bases we needed 50, 25, and even 10 years ago are no longer needed. For the sake of our security and prosperity, tough decisions can no longer be put on the back burner.
Congress needs more “adults” in the room who can create a path back to prosperity for our nation. Keith Ellison has been anything but the adult in the room. The “People’s Budget” that he proposed failed miserably and didn’t even get all of the votes in the Progressive caucus that he co-chairs. We cannot let history indict us for sending Ellison back to Washington with the same stale ideas and promises while we hope for a different result.
Part of the promise of America is that the next generation will be better off than the current generation. That has been true throughout all of our existence and must remain true today. This is our generation’s Carpe Diem moment. Previous generations have faced tough challenges; future generations are now counting on us. Solving our problems isn’t going to come down to who is right, but rather what is right. It’s long past time to put politics and ideology aside so that we can Come Together.
The President is responsible for submitting an annual budget to Congress and has the authority to veto legislation, including irresponsible spending. Most Administrations have run small but manageable deficits, but President Obama’s unprecedented budget deficits pose serious economic risks.
BUDGET DEFICITS AS A PERCENTAGE OF GDP, BY ADMINISTRATION