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Op-ed views and opinions expressed are solely those of the author.
The year 2020 will be remembered for the coronavirus, riots in the streets, and record debt hitting the federal government. The year is only half over, yet it feels like it has lasted a decade. The issue of debt is one that American taxpayers will be paying off for generations.
The numbers for this year are mind-blowing.
The New York Times reported on July 13, 2020, “The United States budget deficit grew to a record $864 billion for June as the federal government pumped huge sums of money into the economy to prop up workers and businesses affected by the coronavirus, the Treasury Department said on Monday, an amount that is expected to grow as a surge in cases portends prolonged economic pain.” The deficit for last year was almost $1 trillion at this point, yet FY 2020 has already surged past $3 trillion in the first nine months of the fiscal year that ends on September 30, 2020.
What’s concerning about this spending spree is that it seems unfocused. The Intercept reported that banks are expected to make $18 billion in processing fees from the small business loan program (PPP). The Hill reported that lobbying groups received millions in PPP money after they lobbied for a change in the law that initially banned lobbyists from benefitting from the program.
There were also reports that some Members of Congress and Trump Administration officials benefitted from the program while a swath of small businesses were going belly up. The aid was not targeted well enough and efforts moving forward need to be drafted in a more targeted manner. Finding a way to pay for this new stimulus spending is of paramount importance.
The Pentagon is tasked with defending America from foreign threats. However, one domestic threat is the national debt and some of the questionable spending in the Department of Defense. One case study in overspending is the project by the Marines to spend $31 billion for the CH-53 King Stallion helicopters. The Marines want 200 at $138.5 million per helicopter. This is a helicopter that is wildly expensive and rife with safety issues. The Defense Department put out a report on this helicopter that concluded a number of structural problems. One example amongst a host of expensive programs at the Pentagon.
House Democrats are pushing another bailout bill that includes, according to a study published by The Heritage Foundation, a provision “extending the $600 unemployment bonus,” that encourages people not to work.
Democrats also want to encourage high tax states to keep taxes high by “lifting the SALT cap” that would lift the $10,000 cap on the federal deduction for state and local taxes for two years. The House Democrats also want to forgive up to $10,000 of student loans for every borrower while also bailing out the post office to the tune of $25 billion. All of these new expensive provisions will add even more debt and the Senate is in the process of drafting up their own next phase of a coronavirus relief bill.
Any attempt to spend more money needs to come with a plan to tackle the mounting debt of American taxpayers. The collective national debt is at about $26.5 trillion. According to the site U.S. Debt Clock, each citizen is carrying $80,370 in debt with $213,276 attributed to a smaller universe of actual taxpayers. When you break down the categories of spending and opportunities for savings, you have to look hard at Medicare/Medicaid $1.3 trillion so far this year, $1 trillion for Social Security, and $700 billion in defense spending. Mandatory and discretionary spending needs to be reformed or the U.S. is facing a real debt crisis in the next few years.
It is easy for politicians to find ways to spend trillions, yet hard to find cuts to pay for new spending. Congress has yet to find cuts to balance the budget. Now is the time for Congress to make some tough decisions to pay for all the overspending of the past few decades and to put America on a better course of spending going forward.
- Pro-business Department of Labor needed in difficult times - August 12, 2020
- Facing biggest debt in U.S. history, U.S. military facing tough decisions - July 31, 2020