Our government is very adept at spending your tax dollars and even more borrowed cash, yet does poorly at eliminating waste, fraud, and abuse. Washington has been using Social Security, Medicare, and government pensions as a piggy bank for years to paraphrase Dr. Keith Quincy who wrote the book “Worse Than You Think.” In it he argued the illegal pillaging of these programs has made the problem worse because much of the debt is hidden. The problem is likely worse than everybody thinks.
Washington has done little to address out of control federal government debt. Currently due to the split in power between the Republicans in the House and the Democrats in the Senate a balanced budget has remained elusive. Our deficit for this year ended up hitting $1.7 trillion and government accountants project that deficits will approach $2 trillion annually for years to come.
Now is the time for accountability. Article I, Section 9 of the Constitution requires our government to give account of every dollar taken in and spent. “A regular statement and account of the receipts and expenditures of all public money shall be published.” Since 1996 the Treasury has been putting out the Financial Management Services or FMS report. There are two problems with this: one, only economic wonks read it; and two, it is not an accurate reflection of the games that all the swamp creatures of both parties play.
We the collective citizens cannot tolerate wholesale accounting practices that would land any single American in prison. Yet our leaders and unelected bureaucrats continue to whistle past the graveyard. Total revenues for this year was $4.8 trillion which equals about 18% of gross domestic product (GDP). Just over half of those revenues, or about $2.4 trillion were taxes collected from individuals. To put that in perspective, with government spending at the rate it is today, it would take a personal income tax hike of about 75% to get our budget into balance. The obvious downside is that this shift in resources would destroy the economy and lower the amount the private sector creates while expanding government. Something must change.
First, if politicians of both parties don’t address entitlements today, our nation is going broke. Brian Riedl wrote in May of 2021, that our nation’s long term solvency is at risk, because “over the next 30 years, Social Security and Medicare face a combined $100 trillion dollar shortfall.” This amount only accounts for future payments. Dr. Quincy argues that about 10.1 trillion has been stolen from Social Security and Medicare in the time between the administrations of President Reagan and George W. Bush. This needs to be paid back in real dollars not deficit spending before the projected shortfall can be addressed. Our debt over the history of our nation comes nowhere near that number today.
A secondary problem is there are wasteful programs on the discretionary side that are treated as if they are entitlement programs. According to the Congressional Pig Book put out by Citizens Against Government Waste (CAGW) there are numerous examples of waste to choose. One project they highlight is the $1.7 trillion F-35 Joint Strike Fighter (JSF) program. The F-35 JSF program has continued problems with prompt delivery of aircraft and design flaws. Bloomberg reported recently that the latest deficiency in the program is that military continues to receive “F-35 jets with flaws discovered after the fighter jets are delivered, according to the Pentagon’s contracts management agency.” Add this to the long, long list of problems plaguing this program that according to the Government Accounting Office (GAO) is “more than a decade behind schedule and $183 billion over original cost estimates.” A program that has systemic problems needs to be examined and not treated as if the contactor has an entitlement to taxpayer cash when the contractor under delivers. There are also seventeen government intelligence agencies that would be good candidates for audits.
One of the most unlikely governments is showing D.C. politicians the way. The mayor of New York, Eric Adams, just released a proposed budget that finally deals with reality. Education, public safety, and sanitation are all being drastically cut, in an attempt to balance the city’s budget. As goes New York City, so goes America is an old saying. America needs not only a balanced budget, but one that pays down real debt instead of adding to it.
Now is the time to deal with debt or the future of our Republic is in danger of destruction, not because of a military confrontation, but because our debt collapses the U.S. economy. All households understand interest, yet our lawmakers have no interest in the interest or our best interests.