Americans want to have it both ways [UPDATED]Published 9:33am Tuesday, September 4, 2012 Updated 11:35am Tuesday, September 4, 2012
When push comes to shove, American taxpayers and politicians cave in and kick the deficit mess down the road so that our children and grandchildren can pick up the pieces.
We refuse to give up or pay for our sacred cows.
We want to have our cake and eat it, too. Even here in Otter Tail County, we’re in favor of cutting the other person’s federal program, but not ours.
“Since we’re living on borrowed money, we have to owe someone. China is one of those someones,” says David Walker, former Comptroller General of the United States.
Walker said that if we don’t end up reforming our ways, federal taxes will have to double within the next 20 to 30 years, just to stop the bleeding. Every American worker’s share of the national debt is more than $90,000.
“Interest on the national debt, if we don’t take immediate action, will soon be the largest item in the federal budget,” said Walker. “And you get nothing for it.”
In 2010 Republican states, on average, received $1.46 in federal spending for every tax dollar paid in. Democratic states, on average, received $1.16.
The federal government must make regular interest payments on the money it has borrowed to finance past deficits . In 2011, these interest payments claimed $230 billion, or about six percent of our federal budget.
Political inaction will result in the United States facing higher borrowing costs in the future, in the form of hikes in interest rates.
Financial analysts say this could hamper the American economy and result in a further slowdown in economic activity.
The Simpson-Bowles Commission’s work included ways to save trillions of dollars. Republicans and Democrats on the commission recommended deep domestic spending cuts, revamping programs like Medicare and Social Security and initiating new tax revenues.
Republicans refuse to budge on tax increases and Democrats refuse to make some necessary program cuts. The Chinese and others benefit from our fiscal irresponsibility.
Former U.S. Sen. Alan Simpson, Wyoming Republican and an architect of the Simpson-Bowles commission recommendations, is frustrated with members of both parties.
“Politicians refusing to negotiate are hurting our country, not helping it,” said Simpson.
Simpson has soundly criticized anti-tax advocate Grover Norquist, blaming him for standing in the way of a bipartisan solution to the deficit. Simpson also has criticized the AARP (American Association of Retired Persons) for standing in the way of entitlement reforms.
Democrat Erskine Bowles, another architect of the Simpson-Bowles Commission, praises Republican vice presidential candidate Paul Ryan for being honest and straightforward about the need to revamp federal programs.
Yes, you heard right. We have a Democrat supporting the economic philosophy of a Republican.
There also are times when Republicans support the viewpoints of Democrats. So there is some hope that the political system can indeed work.
The right thing to do, as noted by the Simpson-Bowles Commission, is to cut spending, revamp programs and produce more revenue with modest tax increases.
More selfishness, however, appears to be the order of the day.
Tom Hintgen is a columnist for The Journal. His column runs on Sundays.