Most of us were raised with the mantra, “don’t spend more than you have.”
Is what is good for us good for America?
We are grateful for the budget builders in Minnesota and other states for one major reason — the budgets passed by lawmakers and signed by governors must be balanced. More spending requires higher taxes. There is no such thing as an annual deficit or long-term debt at the state level.
The annual deficit and long-term federal debt are a seemingly endless part of the budget dialogue in Washington, D.C. The 2020 Trump budget added more long-term debt, which has been piling up for years, to nearly $29 trillion (that’s with 12 zeros), averaging $86,000 per citizen.
The facts are that the federal government collected $3.5 trillion in fiscal year 2020 — about $10,500 per person. Nine of every $10 came from individual, payroll and corporate income taxes. The federal government spent $6.6 trillion, or nearly $20,000 per person. About three of every four dollars (73%) provided money for the states, Medicare, Social Security, defense, veterans, business aid and other assistance.
An additional $345 billion (one of every available $20) was spent just to pay the interest on the nation’s long-term federal debt last year.
With the current budget ending in September, President Joe Biden has proposed a 2021 federal budget that calls for spending $6 trillion. He previously piloted efforts to pass a $1.9 trillion COVID-19 relief plan and has proposed a $2 trillion plan to build infrastructure for the construction and repair of roads and bridges.
The Senate reduced the infrastructure bill to $1 trillion in spending, but the Congressional Budget Office reported Aug. 5 that the bill will increase the federal debt $256 billion over the next 10 years.
The explanation for the new budget is 76 pages long, calling for huge funding increases for education, health care and environmental protection. Biden says his focus is to boost the lives of the middle class.
The spending of federal money and balancing of annual budgets is certainly a bipartisan challenge. In fact, the only U.S. president to balance the federal budget dates to Andrew Jackson in the 1830s. And our seventh president was only able to do it in one of his eight years in office!
What must we do?
First, people must be informed about the importance of the federal budget. According to a Gallup Poll taken last year, 95% of Americans “worry about the budget deficit,” including a whopping 50% who say they worry “a great deal.” PEW reported that 90% of Americans think it is important to “improve the quality of life for future generations.” A recent survey by POLITICO found that three of every four voters think reducing the deficit is a top priority.
The federal deficit is an extremely complex issue. We will be better citizens if we seek in-depth, accurate information, create a more informed electorate, and ultimately elect lawmakers who will author fact-based actions and avoid harmful, knee-jerk reactions. One such source is David Andolfatto, senior vice president at the St. Louis Federal Reserve Bank (stlouisfed.org). He encourages us to look at the national debt from different perspectives, which in turn will shed light on the current fiscal situation.
A national organization that has taken leadership for over two decades on this issue is the Washington, D.C.-based Committee for a Responsible Federal Budget. Anyone wishing to dig deeper into federal fiscal policy can learn more at crfb.org.
We should ask our U.S. senators and members of the U.S. House from Minnesota to share their views on this alarming, but by no means new, challenge, and offer concrete solutions for the future. We should also expect them to address this burgeoning debt as a bipartisan issue that requires cooperation and not finger-pointing.
Bringing attention to our national debt is worth our time and our leaders’ time to brainstorm about what is best for America.
An editorial from the APG of East Central Minnesota Editorial Board. Reactions are welcome. Send to: email@example.com.