There was a time when it was thought to be prudent to not spend beyond one’s means; a time when frugality was a desirable trait, and when such discipline and restraint constituted a man or woman of wisdom in financial affairs. Judging from the predictable reaction to the storyline fed by the mainstream media regarding fiscal policy in our nation’s capital, such fiscal discipline no longer is perceived as wise, but as extremist and radical.
And apparently there’s an ancillary postulate that accompanies that conclusion; that those who desire to not inflict harm on the nation due to bad government regulation fall under the same broad definitional brush of extremism and radicalism.
Just since 2006, the last year the U.S. government had a budget passed by both congressional chambers and signed by a president, government debt has shot from $6.7 trillion, to over $17 trillion. The largest segment of that spending occurred over the past five years with four consecutive years of $1 trillion deficits. Our government has been spending 60% more than it’s been collecting in tax receipts.
Those figures do not even begin to address our long-term debt due to non-discretionary entitlement programs. According to the General Accounting Office’s (GAO) 2012 annual report, their most recent which was issued nearly one year ago, unfunded debt including Social Security and Medicare was $70.7 trillion, an increase of 8% over 2011 levels. Our national debt increases by an estimated $8.2 million per minute, and about $350 billion per month.
The GAO was explicit in its warning to the policy makers about our spending. They said in the very first paragraph, “GAO’s simulations continue to show escalating levels of debt that illustrate that the long-term fiscal outlook remains unsustainable.”
For those who may have difficulty grasping the gravity of the word “unsustainable,” let’s clarify the term. That means it is “not able to be maintained at the current rate or level.” That it is “not able to be upheld or defended.”
Former Comptroller General of the United States, David M. Walker, has been sounding the clarion call of economic disaster for the nation if spending is not reined in, and politicians refuse to deal with fiscal realities of unabated spending. He describes America as a “sinking ship” in a sea of our own debt. He points out that, “The US ranks near the bottom of developed global economies in terms of financial stability and will stay there unless it addresses its burgeoning debt problems,” based on the Sovereign Fiscal Responsibility Index.
“We think it is important for the American people to understand where the United States is as compared to other countries with regard to fiscal responsibility and sustainability,” Walker said in a CNBC interview recently. He predicts that the country is rapidly heading towards a debt crisis that could come within the next few years if we continue on our present course.
Those are the facts, at least a small glimpse at our dismal fiscal reality. And yet, when facing another massively expensive entitlement, and a debt limit, and a government “shutdown” over spending issues, the press and their chorus of ideologically-compliant sycophants across the land excoriate the one group of politicians that sees the threat of our current reality!
The fiscal terrorists are not those in the House, who out of conscience and their commitment to their voters refuse to budge on spending without fiscal reform. The biggest terrorist threat to the nation are those who vote perfunctorily to increase our debt, continue to spend beyond our means, and refuse to say no to new spending programs that threaten to expedite the collapse of the nation from debt implosion! They are destroying the nation minute by minute, and debt limit increase by debt limit increase, by continuing our unsustainable spending trajectory with no attempt at addressing it.
How idiotic it is when the mainstream media rejoices when a debt limit, regardless of how temporary, is increased. When the government resumes full operations without any substantive assessment of our unsustainable mountain of debt, as identified by the General Accounting Office! And how idiotic it is when a majority of the American public applauds the resumption of our unsustainable course of debt accrual, with no apparent concern for the perpetuity of the republic!
The president is claiming credit for a slight deficit reduction this past year. That’s sublimely ironic considering it happened because of an idea he floated, and then denounced, and become enacted as a 5% reduction in spending known as the sequester.
The sequester has made a slight difference in the trajectory of our mountain of debt, but not nearly enough. If the nation is to survive financially, a change of course and reassessment of our spending priorities is critical. Our role is to be an informed electorate, and if we love America, support candidates with a commitment to saving the nation from the spendthrift politicians in control now.
AP award winning columnist Richard Larsen is President of Larsen Financial, a brokerage and financial planning firm in Pocatello, Idaho and is a graduate of Idaho State University with degrees in Political Science and History and coursework completed toward a Master’s in Public Administration. He can be reached at [email protected].