Ignoring America’s Abyss of Debt
Congress has stared into the abyss of debt, and the abyss has stared back. The national debt just topped $22 trillion for the first time ever, yet barely a peep was heard in the halls of the Capitol. The debt-to-GDP ratio has more than doubled in less than 20 years, rising from 33 percent in 2000 to 78 percent today. Within 10 years, it will reach 93 percent, the highest level since just after World War II.
While currently the federal budget deficit is around $900 billion, beginning in 2022, it will exceed $1 trillion per year, every year, according to the Congressional Budget Office. Over the next decade, deficits are projected to fluctuate between 4.1 percent and 4.7 percent of GDP, well above the average over the past 50 years.
Yet instead of discussing how we will afford what we are already slated to spend, Congress is debating how much more government should add to that. The national conversation is focused on Medicare for all, how many billions should be allocated for a wall, and Alexandria Ocasio-Cortez’s Green New Deal. Far from reforming our out-of-control spending, these policies would only cost more.
Based on the muted public response, you’d never know that a mere decade ago, the national debt was half of what it is today, or that the debt is projected to keep up its exponential rate of growth as the U.S. population ages. Even if Congress were to vote against every dollar of new spending, the debt held by the public will still be 150 percent of the total economy by 2047. And by the looks of this new spending bill, it will reach that ratio far sooner than that.
Here are just some of the things this year’s deal spends money on: $5.3 billion for Israel, Ukraine, and Jordan; $3.4 billion in refugee assistance ($74 million more than last year); $4.4 billion in international disaster assistance ($100 million more than last year); $8.83 in global health programs; and $9 billion for international security assistance programs.
Among the few spending items that have been revised down is President Trump’s sought-after border wall. Trump initially wanted $25 billion for an immigration and border overhaul. He shut down the government when Congress did not accede to his smaller $5.6 billion request. This bill, being touted as a “compromise,” allocates $1.38 billion for constructing a wall, or “pedestrian fencing.” Before the shutdown, Democrats were willing to allocate $1.6 billion. But in the current iteration, border spending is even lower and there are lots of strings attached, including restrictions on which sections of border the fencing can be built on.
Still, whatever your position on a wall, it’s a bit strange to hear the House Freedom Caucus, supposed scourge of big budgets, castigating government for not spending enough. “Only in Washington, DC can we start out with needing $25 billion for border security measures and expect applause when we come up with $1.37 billion,” House Freedom Caucus leader Congressman Mark Meadows tweeted just days ago. “Once again Congress is not doing its job.”
“If [Trump] signed the bill, based on what has [been] reported and suggested is in the bill, and did nothing else, it would be political suicide,” said Meadows also said. “If he signed the bill, based on the way that we believe the bill to be, and takes other methods to obtain funding for additional border security measures, then I think there’s very little political liability from conservatives.”
That’s a telling admission. How can there be “very little political liability” in voting for a bill that adds exponentially to the debt? When did the deficit stop mattering? How can the group that led a revolt against former speaker John Boehner over spending bills hammered out in secret agree to over a trillion in unpaid-for federal spending?
[As of Thursday night, after the Senate passed the spending bill and the House was expected to pass it, it appeared that Trump was still considering an emergency declaration in order to find the remaining money for his wall.]
The harsh reality is that Republicans were never really committed to curbing spending. Under President George W. Bush, the debt ballooned to $10 trillion. Republican presidents Ronald Reagan and George H.W. Bush added to the debt, too.
It was President Barack Obama who truly made history in this category, leaving the country with almost $20 trillion in national debt, thanks in part to the American Recovery and Reinvestment Act he signed in the wake of the Great Recession. The Tea Party led a wave of impassioned grassroots supporters who railed against the debt Obama was incurring. But their plans to fix things were always considerably murky where the budget was concerned. Consider that conservative talking heads like Sean Hannity endlessly hawked laughably unserious proposals like the so-called “penny plan.” The Tea Party’s opposition to “illegals overrunning our border,” on the other hand, was always much clearer.
That’s why it makes political sense for Trump to shut down the government over a wall, while Republicans vote in lockstep to continue the spending binge. For both Republicans and Democrats, “the political rewards for curbing runaway budget deficits are too meager to justify the risks,” writes Robert J. Samuelson. ‘There’s a consensus to do nothing—and to hope that nothing goes disastrously wrong.”
That’s also why, in 2018, only seven members of Congress voted to cut overall spending: Senators Rand Paul and Mike Lee, and Congressmen Justin Amash, Thomas Massie, John Duncan Jr., Raul Labrador, and Morgan Griffith.
It should go without saying that we can’t afford new programs by just printing money to pay for them, as freshman Ocasio-Cortez has proffered. Markets can handle unstable conditions for a long time, but eventually they break under the weight of debt and interest that far outpaces productivity. For many years, Greek and German sovereign bonds had nearly the same yields. When light was shed on Greece’s fiscal problems, however, interest rates spiraled and the country faced bankruptcy.
The United States isn’t Greece, but its fiscal condition is worsening and right now there’s no willpower to make it any better. This was expressed with brutal honesty by President Trump, who admitted in December that the prospect of a debt crisis doesn’t bother him because “I won’t be here” when it blows up.
“He who fights with monsters should be careful lest he thereby become a monster. And if thou gaze long into an abyss, the abyss will also gaze into thee,” German philosopher Friedrich Nietzsche wrote in Beyond Good and Evil. There, Nietzsche reflects on the folly of believing good and evil to be opposites, rather than just different expressions of the same impulses. What an apt metaphor for Republicans in Congress, who for years thought adding to the debt was wicked until they tried it themselves.
Barbara Boland is the former weekend editor of the Washington Examiner. Her work has been featured on Fox News, the Drudge Report, HotAir.com, RealClearDefense, RealClearPolitics, and elsewhere. She’s the author of Patton Uncovered, a book about General Patton in World War II. Follow her on Twitter @BBatDC.