America’s federal debt now exceeds $21.2 trillion, and each citizen’s share of that debt is more than $64,500. The Congressional Budget Office, in its “Budget and Economic Outlook: 2018-2028,” said that our federal debt is projected to be on a steadily rising trajectory throughout the coming decade. Debt held by the public, which has doubled in the past 10 years as a percentage of gross domestic product (GDP), will approach 100 percent of GDP by 2028, predicts the CBO. Robert L. Bixby, executive director of the federal watchdog Concord Coalition, called that CBO report “the most alarming budget outlook in our nation’s history.”
A couple of months ago, officials of the International Monetary Fund voiced their own concerns that economically advanced countries around the world have debt-to-GDP ratios that are at levels not seen since the end of World War II.
While some of those countries are taking advantage of positive economic conditions to start lowering their public debt ratios, said the IMF, the United States plans to dig itself even deeper into debt over the next five years.
The country’s political leaders in both parties have demonstrated little concern for our country’s debt crisis. The week President Barack Obama was inaugurated in 2008, the U.S. public debt was $9.2 trillion. By the time he retired eight years later, the debt had more than doubled, to $18.9 trillion.
President Donald Trump and his Republican supporters have bragged loudly about what they see as positive economic effects of the so-called Tax Cuts and Jobs Act passed last year. That legislation included reductions in both corporate and individual income taxes, significantly reducing federal tax revenues. Rather than cut federal spending to compensate for lost revenue, Trump and Congress pushed through a $1.3 trillion spending bill for the remaining six months of fiscal 2018 that the CBO estimates will add at least another $1 trillion to the federal debt.
For more than two decades, the Concord Coalition has been sounding the alarm concerning the fiscal irresponsibility that prevails in Washington. Despite its best efforts, the situation has gotten worse. In March, after the latest spending bill was approved, coalition director Bixby spoke out yet again. “Rather than working to put the budget on a sustainable path,” he said, “Trump and Congress are making things worse.”
That budget bill included an $8 billion increase over previously authorized levels of defense spending and a $63 billion increase in domestic spending. “Instead of setting priorities and making difficult choices, lawmakers reached a bipartisan agreement to simply borrow and spend. The combination of tax cuts and spending increases will likely lead to the return of trillion-dollar deficits in the next fiscal year and beyond, despite a growing economy,” Bixby said.
The IMF contends that countries should use the window of opportunity afforded by the economic upswing to strengthen the state of their fiscal affairs. It’s managing director, Christine Lagarde, told The Washington Post recently that, “Because growth is good, we say, ‘When the sun is shining, please fix the roof.’ Build buffers, use your fiscal space to actually do the structural reforms that will improve your overall productivity.” The IMF urges governments “to avoid fiscal policies that provide unnecessary stimulus when economic activity is already picking up.”
Clearly, our political leaders from both parties have ignored that advice.
When our sister paper The Ellsworth American commenced weekly front page publication of the national debt in 1999, the amount stood at $5.6 trillion. Now it’s $21.2 trillion, and the debt clock keeps on ticking. As the late American editor James Russell Wiggins wrote more than 18 years ago, “We need to be confronted regularly and publicly by this shocking and sobering message of an obligation that, unchecked, will overwhelm us all.”
That day draws inexorably closer with each tick of the clock. We ignore that warning at our collective peril.