National Debt is Killing Us!

Though Congress has failed to pass a budget for 2011, our President did offer a budget proposal February 1 of this year.  Have you seen it?  Have you seen the staggering admissions made in this document?  No?

I didn’t think so.  I’ve not seen it reported anywhere either.  But it’s right here, in PDF format, for all the world to see, courtesy of the Government Printing Office.  I posted an article on this previously, which you can view for more detail if you like, but I wanted to examine other facets of this problem this time.

The President himself introduces this budget proposal in what sounds like a campaign speech.  Here are some the words that explain our situation, picking up after explaining the big problems he inherited from the previous administration:

That is why even as we increased our short-term deficit to rescue the economy, we have refused to go along with business as usual, taking responsibility for every dollar we spend, eliminating what we don’t need, and making the programs we do need more efficient. We are taking on health care—the single biggest threat to our Nation’s fiscal future—and doing so in a fiscally responsible way that will not add a dime to our deficits and will lower the rate of health-care cost growth in the long run.

We are implementing the Recovery Act with an unprecedented degree of oversight and openness so that anyone anywhere can see where their tax dollars are going. We’ve banned lobbyists from serving on agency advisory boards and commissions, which had become dominated by special interests. We are using new technology to make Government more accessible to the American people. And last year, we combed the budget, cutting millions of dollars of waste and eliminating excess wherever we could—including outdated weapons systems that even the Pentagon said it did not want or need.

We continued that process in this Budget as well, streamlining what does work and ending programs that do not—all while making it more possible for Americans to judge our progress for themselves.  The Budget includes more than 120 programs for termination, reduction, or other savings for a total of approximately $23 billion in 2011, as well as an aggressive effort to reduce the tens of billions of dollars in improper Government payments made each year.

The President says tackling Health Care will “not add a dime to our deficits”, along with several other optimistic claims using words like “cutting”, “streamlining”, “ending”, and “progress”.  So what’s the big deal?

Our spending is ridiculously out of control.  We cannot possibly sustain it.  Yet that’s exactly what’s proposed in this year’s budget—more spending!  “How will we pay for that?” you might ask.  Good question.  It’s answered here, in this graph I pulled from the President’s proposed budget (found on page 157 of the document).

Do you notice anything odd in our anticipated revenue?  What’s the largest revenue category for 2011?  Individual Income Taxes?  No.  It’s “Borrowing and Other Net Financing”.

Debt.

The largest category of “Revenue” for 2011 is debt.  Though I’m not an accountant, considering debt as income seems a bit backward to me—that sort of plan certainly wouldn’t work for my household, anyway.  Can you imagine coming home from a hard day’s work and announcing the bacon you’re bringing home is in the form of a sweet new loan you got from the bank?  “No, I didn’t earn anything today, but we scored huge in this $20,o00 loan!”  Yeah, that would work.

But someday that loan will come due.  Could you pay for it?  If so, with what?  Sooner or later you’d need to earn some money to pay for your spending.  Failure to do so is bankruptcy.

And that, folks, is what we’re facing on a national scale right now.  Tremendous spending financed by borrowing.  According to the graph above, personal income taxes would need to more than double to pay for this year’s proposed borrowing!  And that doesn’t take into account the fact that we citizen-minions aren’t in a position to have even more of our money taken from us.

Borrowing is not adding value to our economy, it’s delaying earning.  Is that really “revenue”?  When will we really earn back what we borrow?  Will our grand-kids even pay off our current spending?

How do we put the levels of spending (and debt) into perspective?  The folks at Bankrupting America created a video that shows our situation in terms that are easier for me to envision:

What about you?  Are you happy with your servants in Washington who are so eager to spend your money?  Your grand-children’s money?  Do they know that?  You can let them know exactly what you think by contacting them and giving them a piece of your mind.  After all, they don’t even read the bills they pass into law—how can you expect them to read your mind?