You may think that this is nonsense and that I am suffering from deficit hysteria or that I have some political agenda, and you could be partially right, however I challenge you to read the rest of this article come your own conclusion.

David Walker, former head of the Government Accountability Office was on NPR’s Fresh Air from WHYY last night (mp3 audio link).  Here is some of what he said:

“The current deficits are very large: in 2009, 1.42 trillion; for the current year, 2010, an estimated 1.5 to 1.6 trillion. But those were caused largely due to significant declines in revenues because of the recession, because of additional expenditures for social safety-net programs, because of two undeclared and unfinanced wars, and a variety of other factors, including bailouts.

Those are troubling, and they are adding to our debt, you know, at record rates, but that’s not what threatens our ship of state. What threatens our ship of state is the structural deficits that will exist after we are out of the recession, after unemployment is down, after the wars are over, and after we get past the current crises.”

The bailouts, the stimulus, the new jobs bill, lower tax revenues, all these things result in a disastrous fiscal deficit but they don’t hold a candle to the overall structural problems that exist. 

“At the same point in time, we need to recognize that what threatens this ship of state is the ice that’s below the water in the iceberg. It’s not today’s $12.4 trillion in debt. It’s the $50 trillion in unfunded obligations for Medicare, Social Security, other commitments and contingencies that we don’t know how we’re going to keep, and it’s time to start recognizing that reality and taking steps to make sure that we can deliver on the promises that we intend to keep.

The government spends every dime of the Social Security surplus on other government operating expenses, every single dime. There’s no savings for Social Security. We’ve issued additional debt that ultimately what happens is we’ll have to exchange one form of debt for public debt.”

Here is how I see it:

Current analysis by smart people and smart organizations paint the following picture:

• Within 12 years, at current interest rates (which are at unsustainable historic lows) the single largest line item in the federal budget will be interest on the federal debt. It will likely be sooner than this
• In 2035 (25 years from now), based on historic tax levels the only thing the federal government will be able to do is pay interest on the national debt.  No military, no education, no roads, no government

In order to avoid this reality there are only two options that exist, or a combination of the two:

• Raise taxes above historic rates
• Reduce or eliminate entitlement programs

I don’t see cities turned to ashes or mass poverty and starvation but I do see my generation being required to pay more and accept less.  Something which is long overdue.

It will be hard.  You and I have an entitlement mentality.  Admit it, you know you do.  Even though Leslie and I fight every day, every single day (sometimes failing miserably) to actively design and build a better life, there still exists that small rotten seed inside that says we deserve it. 

It’s easy to rely on the “magic” future to fix our problems or to think some mighty government pen will make the pain go away.  I really don’t believe that can happen this time.  What we have are choices.  What we choose determines our future. It is as simple as that.

One last quote:

“Let’s recognize reality. They’re three key points with regard to spending. Spending more money than you make on a recurring basis is irresponsible. Irresponsibly spending somebody else’s money is unethical – and if youre a fiduciary, a fiduciary breech. And irresponsibly spending somebody else’s money when they’re too young to vote and not born yet is immoral. And all three of those things are going on right now and they threaten America’s future.

The decisions that we make or that we fail to make within the next five years, will largely determine whether our future is better than our past. And in my view, I want it to be better – for the sake of my kids and my grandkids.”

Still haven’t had enough? Here are your next steps:

1. Read about the history of the National Debt
2. Better yet read about what you can do to fix it

How about these apples: Try reading articles and analysis from someone other than an amateur blogger from Rochester New York.

1. Peter G. Peterson Foundation
2. CATO Institute
3. Washington Post

You know what?  Let’s just let future generations deal with it.  Let’s just watch OK Go’s new YouTube video instead.

Related posts:

1. Challenger Explosion: The Future Doesn’t Belong to the Faint Hearted

Tagged as: Politics and Government