Ticking Time Bomb: Our National Debt

By Andrew Hicks on June 17, 2017

Editor's note: This guest post was written by Andrew Hicks, blogger for youthinmoderation.org, and the views expressed may not necessarily represent The Centrist Project

Remember in 2013, when Republicans caused a government shutdown? It’s that time again.The issue on the table: raising the debt ceiling to increase the amount the government can borrow.

Republicans stonewalled four years ago for two reasons. Conservatives scorn increased spending (an excessive military doesn’t count as “spending,” apparently) and heaven forbid Republicans work alongside liberals, national repercussions be damned. Desperate times call for desperate pandering.

At first glance, the Republicans' argument makes good sense: debt is bad. The trouble is, our government uses borrowed funds to pay back loans. And if they can't? CNN Money asserts that, "Because U.S. debt is considered the safest investment in the world, missing any payments due ... would risk a market and economic crisis." Partisan politicians held the country's economic well-being ransom, all while playing hero.

Now the same vote comes around, but this year the House and Senate are in Republican control. As the majority, I believe that they will pass the bill without incident (ideological purity notwithstanding). But opinions aside, it’s time for a fact none of us want to admit.

We Can’t Keep This Up Forever

In past decades, the debate has surrounded the allowance of more debt. But this completely ignores the problem - raising the debt ceiling each time we need more money is nearsighted and downright irresponsible. We need to decrease our astronomical deficit. One day lenders will refuse to fund the U.S. anymore, and if you thought the 2013 shutdown was bad, wait until we’re left empty handed on that one.

This all began because one year, the government spent more money than it collected in tax revenue. Ad nauseum. Since spending more than they had is all it took to snowball the problem, all it’ll take to fix it is to spend… less… than the tax revenues. Oh boy.

Instead, both major parties are pushing their own agendas. Let’s see if either of these sound familiar. “A progressive estate tax, also known as the ‘billionaire tax,’ may be the fairest way to begin reducing the federal deficit … That means taxing capital gains and qualified dividends as ordinary income.” Or perhaps you prefer a, “Simple Flat Tax, which reduces the existing seven individual rates to one low rate of 10 percent for all Americans … and requires every business to pay the same Business Flat Tax of 16 percent.”

The first is a favorite recitation of Bernie supporters. The second was proposed by Ted Cruz. Both senators were the favored alternatives for their parties’ presidential nominations. These might be neat and tidy soundbites for voters, but neither has a prayer of actually reducing the debt.

Bernie makes good sense on one front: unfortunately, a tax increase is a critical component of taming a $20 trillion beast (although some citizens, myself included, find issue with vilifying the rich. “Fair” contribution is a point of contention.)

But, that revenue means nothing if it doesn’t ensure a budget surplus. Instead, his own website displays proudly: “There are many politicians who want to reduce this deficit by cutting back on social programs. For years, Bernie Sanders has sharply criticized politicians who support such policies - which he considers regressive.

The cost of social programs are already far beyond what the government can afford to allot them, and it’s expected to increase with each passing year. Most of this “billionaire tax” would likely be needed just to keep entitlements sustainable - which might slow that $20 trillion increase but sure wouldn’t eliminate it.

Just to add insult to injury, a flat tax in lieu of the bracketed progressive tax would worsen income inequality in America, and good old supply and demand suggests that price increases and inflation would negate our newfound affluence. The poor become comparatively poorer than before, but this time with bare-bone benefits.

With no viable solution in sight, it’s a wonder the two parties haven’t driven America into the ground for the sake of appealing to base. So what can we do? The next post of the series will outline solutions in light of these failures.