A moment of truth on U.S. debt
The Washington-based Bipartisan Policy Center predicts that the federal government might be unable to pay all of its bills as early as Feb. 15.
Steven Bell, the center's senior director, said: “We have less time to solve this problem than many realize.”
The fact is the pending debt ceiling negotiations may possibly be the most defining point in decades for the economic future of the United States and its social welfare programs.
In order to secure the continuation of their political careers, politicians of both major parties have expended vast sums and promised even larger amounts of money while paying scant regard to the funding of those obligations. The realities of the true costs were disguised by increases in Treasury debt and dollar debasement that exploded once President Nixon removed the last link of the dollar to gold in 1971.
Other disguises included unabashed manipulation of bond markets and interest rates and by changing the assumptions, or “doctoring” downward, key government statistics such as unemployment and inflation levels. The latter had the effect of falsely portraying an increased level of economic growth.
The careers of most incumbent politicians benefited greatly from these grave economic deceptions. Indeed, as the economy and dollar have declined, the salaries and benefits of politicians have increased markedly.
The Treasury debt ceiling was established to prevent a spendthrift government from encumbering Americans with unbearable levels of debt. As a matter of responsibility, Americans benefiting from government funds today should think of the debt devolving to their children.
According to the Census Bureau, there are about 100 million Americans 18 or younger. The Treasury debt of $16.4 trillion encumbers each child with $160,000. When you include all unfunded government obligations such as Medicare and Social Security, actual or moral debt obligations exceed $120 trillion. This imposes a moral debt obligation of about $1.2 million per child.
This debt undoubtedly implies an enormous drop in living standards.
Little wonder that CNBC-TV's Rick Santali coined the phrase “All Kids Left Behind.”
President Obama clearly has no intention whatsoever of negotiating any real restructuring of entitlement programs or of ObamaCare. It appears his hand must be forced.
Congress has little or no power to control the president — except to place a strict limit on Treasury debt.
The Republican-controlled House will have to block any debt increase without cast iron entitlement reforms. In recent “fiscal cliff” negotiations, the prospect of widespread tax increases forced some Republicans to capitulate.
Now, the serious prospect of closing down parts of the government comes into play. To reduce enormous waste, the federal government needs serious pruning.
Will Republicans or Democrats have the courage to think of future generations rather than the next election?
Our politicians will have a great deal to answer for if they continue to sentence America's youth to a life of poverty from extensive debt. The time is long overdue that Congress was forced to balance the books.
John Browne, a former member of Britain's Parliament, is a financial and economics columnist for Total Trib Media. Email him at firstname.lastname@example.org.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- U.S. Steel to relocate corporate headquarters on former Civic Arena site
- Clues to Chief Justice John Roberts’ thinking on new ObamaCare case
- High winds, warm temps in Western Pennsylvania on Monday
- Finding balance between toughness, excessiveness key for Penguins’ Downie
- Pirates trade Davis to A’s for international signing bonus money
- Starkey: No explaining Steelers, AFC North
- NFL parity makes playoff chase a multi-team muddle
- Bunny Mellon auction fetches $218 million
- For Steelers, a fight to finish for playoff berth
- CT scans can find smokers’ lung cancer early
- Obama announces Hagel resignation from Pentagon