There are many ways to solve virtually every problem we face as a species. Solutions can range from simple to complex, from short-term fix to long-term repair and may be crude or elegant. Any societal problem you might examine, be it education, health care or fiscal health, can be brought examined, debated and fixed in due course.
The first step to solving any problem is to establish the basic facts of the matter. Even this can be complicated, particularly if the issue is chronic or convoluted. One issue of great interest to me is the matter of public debt. I have two young children and I’m at a point in life where I am thinking about what legacy they will be given by me personally and by my generation in a broader sense.
It can be a little daunting to examine the public debt of a country as large as the United States of America. When numbers start reaching into the trillions, it’s can be a bit challenging to maintain perspective on the issue. Last year, the U.S. Government spent roughly $400 million per hour. According to an interesting Wall Street Journal article on the topic yesterday, two-thirds of the annual budget is on “autopilot”. Congress can change these programs if it wishes, but if it does not review them, the money allocated for programs like Social Security, farm subsidies and Medicare payments will be spent.
The article quoted Eugene Steuerle, an economist at the Urban Institute think tank in Washington as saying: “In 2009, for the first time in the nation’s history, every dollar of revenues had been committed before Congress walked in the door.” In short, any payments promised from the past (e.g. Social Security, Medicare, Medicaid, etc.) were covered, but any new spending was paid from fresh borrowing.
Two of the most troubling facts mentioned in the article were that:
About $1 of every $5 the federal government spent in 2011 went to defense, and about 20 cents of that $1 was spent on the wars in Iraq and Afghanistan. In all, the U.S. spends about $700 billion a year on its military. That’s more than the combined military budgets of China, the U.K., France, Russia, Japan, Saudi Arabia, Germany, India, Italy, Brazil, South Korea, Australia, Canada, Turkey, the United Arab Emirates, Spain and Israel.
About $1 of every $4 the federal government spends goes to health care today. That is rising inexorably. In 1981, spending on Medicare for the elderly and disabled and Medicaid for the poor accounted for 9.5% of federal outlays besides interest. By 2011, the two programs were consuming nearly 25%. In 2021, if current policies remain in place, government spending on health care will consume 33%, according to the Congressional Budget Office, even if the Affordable Care Act survives Republican attacks.
This does not bode well for my childrens’ generation. Were this the financial snapshot of an individual’s fiscal health, most advisors would likely prescribe uncomfortable, but necessary medicine that would include a mix of austerity measures and an investment in directions that look promising from an income standpoint in the future. The challenge with such a prescription at the national level is that these issues are highly politicized and leaders elected by people who more often vote for personal concern than for virtue. Poor leadership in elected positions are only a symptom of the underlying problem of apathetic citizens.
Thomas Jefferson said: “I place economy among the first and most important virtues, and public debt as the greatest of dangers to be feared. To preserve our independence, we must not let our rulers load us with perpetual debt. If we run into such debts, we must be taxed in our meat and drink, in our necessities and in our comforts, in our labor and in our amusements. If we can prevent the government from wasting the labor of the people, under the pretense of caring for them, they will be happy.” For my part I see it as expedient to make sure that my own house is in order, for healthy cells make a healthy body.
We have become a people who lulled into the temporary false sense of comfort which comes from living beyond our means. If history proves a reliable guide, the yolk sac of abundance produced thereby eventually dries up and we, the people are then left with the hollow mockery of a brittle shell of what once was present in truth: promise, liberty and peace. Be sure that if this comes to pass it is no one else’s fault but ours.