October 2021
While we watch the national debt pass $28 trillion, thankfully Nebraska’s State Constitution requires a balanced budget.
Omaha voters should feel good about the low-rhetoric, fiscally responsible way in which Mayor Jean Stothert and the City Council have led. Despite the obvious benefits of tamped-down partisanship, odious actors maneuver to undermine George Norris’ nonpartisan unicameral system.
Money, get away. Get a good job with more pay and you’re OK. (Pink Floyd, “Money,” from “Dark Side of the Moon”)
While the economics of our national debt is complex, it’s clear that increasing spending amid massive tax cuts doesn’t work. Meanwhile, Washington officials leverage gorged spending to curry favor among voters and special interests.It appears President Joe Biden has committed to Modern Monetary Theory, the idea that since we print our own currency, debt is not a concern. Gone are the days of discerning between needs, those things that require government spending; and wants, expenditures that haven’t previously won political approval.
As the number of those paying federal income taxes declines, the per-taxpayer share of the national debt exceeds $228,000. That’s not including Biden’s $5 trillion in spending bills.
Grab that cash with both hands and make a stash. New car, caviar, four-star daydream, think I’ll buy me a football team.
While there is plenty of fodder to wallop Biden, Republican administrations have grazed equally at the trough of excessive spending. According to WhiteHouse.gov, Jimmy Carter contributed a paltry $75 billion per year to the national debt while Ronald Reagan contributed $450 billion annually. Things tamped down under H.W. Bush ($375 billion) and Bill Clinton ($325 billion) before skyrocketing under G.W. Bush ($1.55 trillion per year). Barack Obama’s terms added $1.037 trillion per year while Donald Trump grew the debt by $1.7 trillion annually. Some estimate Biden could grow the debt by $1.825 trillion per year.
Money, it’s a crime, Share it fairly but don’t take a slice of my pie.
What to do? Weighing expenditures is one answer.
Recently Sens. Chris Coons and Raphael Warnock proposed government funding of Historical Black Colleges and Universities. HBCUs afforded African Americans a pathway to higher education at a time when racism and Jim Crow prevented them from attending most other institutions.
Although HBCUs certainly cradle unique cultural experiences and traditions, at a time when our national debt is so high, does this make fiscal sense? Should the federal government step up funding private HBCUs when we already have an extensive system of land grant universities?
Another option to addressing our rising national debt is to rein in spending.
Money, so they say, is the root of all evil today. But if you ask for a raise it’s no surprise that they’re giving none away
Despite warnings from Harry Truman and Dwight Eisenhower, military spending remained high as the Cold War heated up. In 1996 we spent $266 billion on defense (16.8% GDP). Today we spend $800 billion annually (19.3%). However, China, ($252 billion) and (Russia $62 billion) combined, spend about a third of what we spend. For example, the United States today has 20 aircraft carriers. China has four and Russia has one. Earlier this year, the secretary of the Air Force asked Congress to allow him to retire obsolete aircraft systems including A-10s, C-130s, KC-10s, and MQ-9s because “they consumed necessary resources.”
One way to think about our debt-funded, defense umbrella is that it allows European nations to spend 1.4% of GDP on defense. One could argue that U.S. taxpayers are indirectly funding Europe’s free health care. Should we?
If we’ve learned anything from Korea, Vietnam, Afghanistan and Iraq, it’s that military superiority alone has not won land wars.
What’s the lesson?
If we want to pass on something other than a national dumpster fire to our children and grandchildren, we must approach spending, and taxing, more responsibly.
This issue demands hard, unpleasant but necessary, civil, public debate to determine national priorities. “All of the above” is no longer an option.
I’m in the high-fidelity first-class traveling set. And I think I need a Learjet
Like the Greatest Generation that preceded us, baby boomers must lead by making personal sacrifices and forgoing wants, by demanding intellectual honesty from ourselves and elected officials, choosing to tamp down the corrosive effects of hyperpartisanship, and living within our means.
|
President |
Net Contribution to Debt in Billions |
Annual Equivalent in Billions (yrs/net) |
|
Biden |
7,300 |
1,825 |
|
Trump |
6,800 |
1,700 |
|
Obama |
8,300 |
1,037 |
|
Bush #43 |
6,200 |
1,550 |
|
Clinton |
1,300 |
325 |
|
Bush #41 |
1,500 |
375 |
|
Reagan |
1,800 |
450 |
|
Carter |
300 |
75 |
JREGAN2
ReplyDeleteThe national debt rose by almost $7.8 trillion during Trump’s time in office. That was during the self-proclaimed "best economy ever!", a time when one would be paying down their debt if one used the example of a household I hear used by so-called conservatives in expressing their views on the matter. Other than increased economic inequality, what do we have to show for it?
But really , what would you expect from the Party and its members so ignorant of history and reality that they worship as a fiscal conservative the President who added more debt than any non-wartime President and made doing so an institution. Can any of them here take a stab at who that was?
Benjamin Johnson
Here's where your claim falls to the ground. Trump isn't conservative and your imaginary conservative friends should have advised you of this.
Your facts aren't accurate. Obama added $8.6T to the national debt, which by my math, is less than $7.8T. Obama wasn't a war-time president nor did he have a pandemic to deal with. Which by the way, required $2.2T in debt and was supported enthusiastically by Prog Libs™, who continue to beg for more pandemic aid to this day. I think adding to the national debt was already institutionalized by Obama.
Finally, why do you want to stab things? Anger issues JR?
October 19, 2021
ReplyDeleteFiscal limits
Rick Galusha’s column calling for a discussion of the federal budget was welcome (“Federal spending and taxation demands hard, unpleasant, civil, public debate”).
As is too often the case, he singled out defense spending as a problem. Defense spending could be adjusted, but our biggest (and most unpleasant) spending problem is mandatory spending; in particular, health care.
According to the CBO (cbo.gov/publication/56073), in 2020, before the COVID spending binge, we spent 3.2% of GDP on defense and 5.4% on health care. (It was 0.8% in 1970.)
In 2030, those figures are projected to be 2.8% of GDP for defense and 7% for health care. At that point, health care will exceed all discretionary spending, both defense and nondefense combined. (So will Social Security, another mandatory spending item.)
And even if taxes were raised to close the current gap between receipts and outlays, health care spending would continue to be a problem because its cost is projected to continue growing faster than the economy ( a CBO report at bit.ly/3aFGDan).
There are no easy answers, but until we get our fiscal affairs in order, we should not pursue any new spending, and any new taxes should be used solely to reduce the budget deficit.
Kris Thompson, Lincoln
Responses to Thompson:
JIM REGAN Oct 19, 2021 7:20am
Yes, Mr. Thompson, there may be no easy answers, but every other developed country has found a solution to them. I would say there are 3 main possible ones:
1. Healthcare industry becomes less profitable.
2. The sources of payment for healthcare be adequately funded.
3. People be denied care if they can't pay for it, like we do with other products and services.
I would add that if we want to the path to fiscal soundness to be truly informed and transparent, the first step would be to eliminate the current largest loophole in our tax code, that one that lets an employer deduct the cost of employer-paid-for insurance but doesn't require the recipient to count it as the income it is. People who receive that $20,000-plus boost to their income have forever been subsidized by others who don't. And more importantly for this discussion, it would illuminate the real cost of health care covered by private insurance, something the vast majority of Americans are currently profoundly ignorant of.
JBECHTEL
ReplyDeletePeople like Kris Thompson are actually unpatriotic defeatists for thinking America is incapable of achieving what other nations have done.
And by the way, military spending does indeed drain resources for tackling our important social problems (as Eisenhower warned). Check out the more realistic budget comparisons here: https://www.nationalpriorities.org/analysis/2020/militarized-budget-2020/
BILL ARMBRUST Oct 19, 2021 7:48am
Comparing healthcare costs from twenty years ago much less 50 years ago is far more complex than simply comparing % of gdp. In 1970 check out the survivability of a 60 year old to stroke, heart disease, or even an accident! Check out the healthcare costs of all 80 year old persons today versus all 80:year olds in 1970. Long term survivability, access to joint replacement, excellent emergency care, drug research, premature birth survivability, diagnostic equipment advances… the list goes on and on and on for reasons the healthcare category has expanded dramatically. Also, in the debate, there is an unreasonable separation of insurance costs currently paid by individuals and employers -from the equations determining healthcare costs going forward in a more socialized medicine system. In the 1970’s churches and church based charities looked at healthcare as a basic human right in America and acted on that principal. Far less could be done for those needy persons and costs were less, but not caring for every person was outside consideration. Wealthy persons did however get better care no doubt. These organizations can no longer afford to do this. Broader Society still can and should. Health care is still a basic human right and to deny it is still wrong. The costs are higher but the basic principal is the same.
Rick Galusha
Mr. Thompson - thanks for taking the time to engage in a civil discussion. You're absolutely correct, my thoughts are not necessarily the best path forward and I applaud your engagement and suggestions. What we know we need is a constructive discussion - thanks for getting it started.
October 17, 2021 (Area musician!)
ReplyDeleteIt’s fixable. Rick Galusha’s commentary of Oct. 12 bemoaned America’s national debt of $28 trillion. This is a problem that is fairly, easily solvable. Demand that the wealthy citizens of this country start to pay their fair share of taxes.
As for the issue of runaway spending, perhaps Dr. Galusha could have included another quote from Pink Floyd’s 1973 hit. That being, “I don’t know. I was really drunk at the time.”
Patrick J. Sweaney, Omaha
Joe Budden Oct 18, 2021 9:59am
Patrick J. Sweaney, would you please enlighten us on what "paying their fair share" means? Put some numbers behind what you say so we can seriously consider it. I mean, personally I think the government has a huge spending problem that it needs to address long before it addresses increased taxes.
when it does come to fixing the tax code, no matter what congress does there will still be loop-holes, deductions, exemptions, etc. for the rich because they lobby for it, and every member of Congress is a multi-millionaire. The only true solution to tax fairness is to ditch the entire tax code and go to a flat tax. Everyone pays the EXACT same percentage of their income, no matter how it was derived. But again, we will never see that, because it would cause the IRS to be woefully over-staffed and we can't fire government employees.