Opinion
A trillion here, a trillion there
It’s been another mosquito-in-a-nudist-colony month — really hard to decide where to start. The biggest recent kerfuffle is about the questionable firing of eight U.S. attorneys by the Department of Justice. When it came out the firings might have been for partisan political reasons, the administration responded in its typically clumsy way with a series of conflicting explanations.
Now the Democrats, smelling blood, want several people, including Karl Rove, to clear that up for them, under oath. In the ensuing power struggle, neither side really can claim the moral high ground, but they both claim the legal high ground. This fight will roil on for a while as both sides jockey for political advantage. Meanwhile, the foul-ups will go on and on.
Not nearly as entertaining or headline grabbing is the Fiscal Wakeup Tour. The U.S. Comptroller General and Head of the Government Accountability Office David M. Walker has undertaken this effort as a public education program. He perceives, correctly I suppose, that folks sufficiently are aware of the nation’s fiscal situation, and need to pay more attention.
I further suppose most people would accept a person in his position probably knows what he’s talking about. He is in the ninth year of a 15-year appointment made during the Clinton administration. Lest that lead to immediate and unqualified accusations of illegitimacy, I will point out that Walker previously had held the position of assistant secretary of labor in the Reagan administration, and was a Medicare administrator in the Bush I administration.
Now, I’m sure Mickey Hepner could discuss this subject much more thoroughly and precisely than I can. But if some of what the comptroller points out makes good sense to an amateur like me, then it may be worth passing on to you.
The Fiscal Wakeup Tour makes use of town hall meetings, talk radio and television, and is conducted in cooperation with The Concord Coalition, The Brookings Institution and The Heritage Foundation. These represent a broad range of philosophies and viewpoints.
First, some figures describing our financial situation: The U.S. government currently has cash assets of $1 trillion. It has $8 trillion of debt. It has $50 trillion of unfunded obligations, out to 2040. These numbers are so enormous that I can’t comprehend them.
But if you owe eight times as much money as you have, and you expect to need 50 times as much as you have during the next 33 years, then you probably ought to be concerned about it.
How did we get into this hole? We dug ourselves into it. More precisely, Walker points out, we ran big budget deficits in the 1980s, increasing the debt. We made severe spending cuts in the 1990s, but have been on a spending spree since 2002.
Walker further points out that while tax cuts help stimulate the economy, and therefore increase revenues, whether tax cuts need to be continued must be questioned seriously. Contrary to popular notion, not all tax cuts stimulate the economy, much less pay for themselves. They need to be controlled, just like spending does.
How do we quit digging the hole deeper? Walker said our greatest challenge is health-care spending. We spend more for health care than any other comparable country. The portion that goes for administrative costs also is higher than in other countries. The 2003 Medicare Drug Benefit Plan alone has an unfunded obligation higher than that of Social Security. We expect far too much of our “system.” We act like health care is just another commodity.
We must reform Social Security, Walker said, by raising the retirement age gradually, indexed to life expectancy; and by raising the wage base for contributions. We do not need to raise Social Security tax rates, but we may have to for Medicare, because of its huge unfunded obligation.
Although its expenses are much less than for the entitlement programs, the Department of Defense is fiscally in a giant mess. Billions of dollars cannot be accounted for. The costs of the wars are orders of magnitude higher than the Pentagon predicted. The “tail” costs, such as the care of disabled and maimed veterans, will go on for decades. Procurement fraud and waste are rampant.
A bipartisan congressional commission is apparently trying to establish accountability in the department. Why don’t I feel optimistic about this?
Will we pay attention to the person who monitors government spending and accountability for performance? Perhaps the better question is, do we care about the financial condition of the country our children and grandchildren will inherit from us?
(Dennis Weigand is an Edmond resident.)
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