After spending a couple of days last week in Washington, D.C., I wonder how Congress and President Obama will settle their differences without hurting the taxpayers or crippling our struggling economy.
There is a high-stakes duel going on inside the Beltway.
House Republicans have approved a continuing resolution that provides stopgap funding for the federal government after Sept. 30 — except for Obamacare, the president’s costly health care law. Their position is that Senate Democrats and the president can avoid a government shutdown if they approve the legislation. In return, Republicans would reluctantly support raising the debt ceiling above the current $17 trillion limit.
Democrats fire back, “Hell no!” They have no intention of defunding Obamacare, and they’re confident that the Republicans will be blamed for a government shutdown and pay the price in the 2014 election.
This “crisis” wrangling has become all too common: There have been 17 government shutdowns since 1976 lasting from one day to three weeks. Once again, the American people are caught in the middle of a political food fight.
On one hand, a majority of Americans oppose Obamacare, which adds trillions to our already bloated national debt. On the other hand, if Congress doesn’t approve a continuing resolution by Sept. 30, federal agencies will quickly run short of cash, hurting those like military personnel who depend on government funding.
Political warring isn’t new. History teaches us that politics in America has always been volatile. In 1804, Vice President Aaron Burr shot and killed former Treasury Secretary Alexander Hamilton in America’s most notorious political duel. Fortunately, today’s political clashes are largely rhetorical in nature.
So, what’s at the root of this latest row over Obamacare?
It is symptomatic of a deeper problem: our federal debt.
According to the General Accounting Office, the president’s national health care law will add $6.2 trillion to our long-term federal debt — that’s on top of our current debt, which amounts to $145,000 for every American taxpayer.
The problem gets worse as increasing numbers of Americans flock to sign up for Social Security, Medicaid and Medicare.
Social Security is funded by the payroll taxes of current workers to pay the benefits of current retirees. But the system is not sustainable. For example, in 1950, there were 16 workers supporting each retiree. Today, there are three. In 25 years, we will be down to two.
Entitlement spending remains the main driver of our high debt. Today, we spend $1.6 trillion on Social Security, Medicare and Medicaid. That figure will double in the next 10 years. By that time, these payments are projected to consume $3 of every $4 of government spending.
The biggest threat to our entitlement programs is if we do nothing.
According to the most recent Social Security Trustees Report, beneficiaries will face a painful 23 percent benefit cut in 2033 when the Trust Funds are exhausted. At that time, even those who are currently on Social Security may experience indiscriminate cuts in benefits at a time when they are increasingly reliant on the program.
The president and Congress must bite the bullet and launch reforms now. They cannot continue to “kick the can down the road.”
It’s time to take corrective action to address the unaffordable path of entitlement spending, to stabilize federal finances and to undertake fundamental tax reform to strengthen the American economy.
