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Our Spending Problem in Perspective

By: Evan Feinberg (Diary)  |  May 24th, 2012 at 11:15 AM  | 

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Cross-posted at ReduceSpending.org. 

Imagine an upper-income American family making $230,000 per year. You’d think they were doing really well, until you find out they are spending $360,000 every year because of their lavish lifestyle, putting $130,000 onto their credit card every year.

You’re even more troubled to find out the family is in some serious debt to pay off their fancy cars and a private jet. Altogether, they owe $1.57 million and within 10 years they tell you every dollar of their paycheck will be going toward food, health insurance and paying back credit card companies and their bank.

If all that isn’t enough, you find out they have triplets who are seniors in high school planning on attending an expensive college in the fall. The children were long ago promised their education would be paid for by their parents. The family once had college savings accounts for each of the three children, but they long ago emptied those savings accounts to pay for vacations.

Sound bad? Add several zeroes, and this story represents our country’s budget situation. We are $15.7 trillion in debt. We’re bringing in $2.3 trillion in revenue but spending $3.6 trillion. Our long-term unfunded liabilities — promises we have made but have no reserve funds to pay for — for programs like Medicare and Social Security total well-over $100 trillion.

Congress has been unable to pass a budget — we have now gone over 3 years since Congress set spending parameters. We have, however, increased our debt limit to $16.4 trillion and are likely to do so again in the very near future.

By 2022 every dollar of federal revenue will be paying for Medicare, Medicaid, Social Security and interest on our debt. That doesn’t leave a dollar for national defense, education or any other priority, regardless of political ideology.

And rather than fix any of these problems, we continue to authorize new programs, increase annual spending, and raise the debt limit regularly.

If you met this hypothetical family in real life, you’d tell them to write a budget and make the hard choices to get their spending under control. You’d implore them not to make any new purchases or commit to any new spending without offsetting it with savings elsewhere in their budget. And you’d beg them not to take out any more lines of credit to pay off their existing debt or their lavish lifestyle.

Hence, the Coalition to Reduce Spending and the Reject the Debt pledge. We’re here to help you take that very message to Congress. We hope you’ll join us by taking our Voter Pledge or contributing to the cause!

Cross-posted at ReduceSpending.org, the website for the Coalition to Reduce Spending (CRS).  CRS is the only national organization aimed solely at advocating for reduced federal spending as a means of balancing the budget. 

COMMENTS

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  • montani

    The solution required isn’t cutting entitlement spending in the future to save our future. We have to cut all types of spending NOW to save our country now.

    • http://evanfeinberg.com Evan Feinberg

      The Ryan Budget is a step in the right direction, but you’re absolutely right that balancing the books in 30 years isn’t going to save our future. We need to cut spending now, which means electing public officials who will make the hard choices NOW. Take a look at ReduceSpending.org and consider taking the voter pledge!

      • WmCraig

        Washington has become an independent imperialist power that focuses all of it’s energy on controlling the population of it;s imperial possessions. We know these possessions as “the states”.

        National politics has been reduced to a tug of war between two opposing sides on any and every issue that offers a choice but never a solution. That is because while the opposing sides struggle for more power in the imperial government, they are united in their resolve to maintain the power of the imperial government. Every choice only increases imperialist power, or modifies how that power is applied.

        Which brings us to the spending reduction matter. As long as Washington is financial independent from the possessions it controls there is no means to enforce reductions in spending. This is the lessons of the 2006,2008 and 2010 elections. American voters tried everything practically and the results are the same. More spending.

        So how do we control spending? The founders created the answer to that. Under the constitution the states, united, controlled the federal government. As we approach the 100th anniversary of the election of Woodrow Wilson and the signing of the 16th through 18th amendments we should pause to consider exactly this question. Because without the 16th amendment there is no imperialist Washington government. Washington gained control over the states by gaining control over direct taxation.

        The truth is that no individual tax payer whether citizen or business has the ability to stand up to an imperialist government. The founders understood well that concept. There solution gave authority to review and reject to the governors through the senate.
        An eloquent solution to the problem we have today with the Obama administrations three greatest evils. Printing money, borrowing money and spending money including money we don’t have without a budget.

        The solution to reducing spending is to restore popular control over the federal government spending and programs. To restore domestic policy to it’s proper host in the states, and to restore liberty to individuals through representative government.

        Repeal the 16th and 17th amendments.

        Nothing else will work. As has been pointed out here the problem with the Ryan budget or any budget that takes 10, 15 or 30 years to balance is that congressional sessions last two years. There is no power that can be imposed on a future congress that can’t be ignored, repealed or revised. It is the responsibility of the current congress to balance the budget. Not during some future time, but during their two years of existence. Everything else is just fraud.

        As long as the power exists in Washington to act independently of the states, united to impose their common will, that power will be abused. If not by this congress, then by some damn fool future congress that we American’s with our amazingly short memory and world renowned optimism vote in to save the world, or eliminate hunger or give us Hope and Change.

        WmCraig
        Solvo Reor