Last week brought another balance-the-budget charade to the American people, ending with another fiscal SNAFU – Situation Normal, All…yeah, you know. It’s a form of glorious national codependency where the American people blame Washington for the gratuitous spending, Washington blames each other, and nothing changes but the increase in national debt.
Consider last week’s wailing and gnashing of teeth as nothing more than a national catharsis that purges our anxiety over impending fiscal doom. We feel better because we drained the angst from our system, but spending remains out of control as the nation drives itself over a fiscal cliff.
Nothing changes because America’s spending crisis can’t be solved.
Not in its present form.
Not without changes the American people refuse to make.
Here’s why.
First, myths about deficits and the national debt.
People think the national debt results from discretionary overspending. $1,000 Army toilet seats, million-dollar federal grants to study the sex lives of hermaphrodite salamanders, Washington pay raises, and legislative pork barrel projects are solely responsible for trillion-dollar deficits each year. They contribute, but they’re not the problem. They’re pocket change that wouldn’t cover 2023’s $1.6 trillion deficit if they were eliminated.
Here’s where the problem lies.
In 2023, 86% of the $6.1 trillion in federal spending covered mandatory budgets that the government must pay according to either federal law or common sense. This spending is locked in; there is no room for cuts. Here’s how it breaks down and why there’s no solution. The following totals came from the Congressional Budget Office (CBO). To see them, click here.
Let’s start with the lowest line items.
Interest on the National Debt: $659 billion. The nation defaults if the government refuses to pay, which is financial suicide.
Income Security and Veterans’ Benefits: $950 billion. This includes financial assistance to the disabled, their families, low-income households, and family members who survive someone who received social security benefits.
Medicare and Medicaid: $1.46 trillion. These cover a portion or all of the health care for a vast number of people in the nation, from illegal aliens to the elderly. It provides cradle-to-grave services, from Children’s Health Insurance Programs (CHIP) to paying the cost of nursing home care for the elderly once they exhaust personal assets.
Social Security Payments: $1.3 trillion. This sacred payment has become the sacrosanct Golden Calf of American politics.
As a conservative, I’ll add this one.
Defense Spending: $805 billion. Defense spending is discretionary and can be cut. But with the war in Ukraine, Middle East conflicts, and China’s desire to take Taiwan, reductions place America at risk.
The total cost of these “untouchable” programs, from the interest on the debt and entitlements to Defense spending, is $5.2 trillion, which leaves only $917 billion in discretionary spending for everything the government does.
So, what exactly is Washington going to cut?
Nursing home care and aircraft carrier battle groups, or weapons development in the age of drone warfare and disability payments?
The answer is — nothing.
Our politicians sold an endless stream of programs to an American public who embraced them with open arms while neither side bothered to ask if the government could pay for them. The generations of largesse have created dependency, and they’re now considered a natural right to which anyone currently living on American soil is presently entitled.
This created the greatest challenge of this entire budget drama — the mindset of the Americans who believe the federal government can pay for all the entitlements the vast majority of Americans can’t live without.
Nearly everyone or their family benefits from some level of government subsidy — whether it’s the Earned Income Tax Credit (EITC) for some working households, who pay no income taxes but receive a payment of thousands of dollars from the federal government if they meet income guidelines, to Medicaid that pays for nursing care for the elderly who have exhausted their resources so families do not have to care for them in their homes.
Much of the nation receives something from these categories, and that’s the problem.
A $2,500 EITC payment doesn’t seem like much compared to a $6.1 trillion budget, but a plethora of small amounts add up in ways people cannot comprehend.
$13.70 is pocket change today that barely covers the cost of a Starbucks and a muffin. But it amounts to $5,000.00 a year when you spend it every day. People don’t realize their daily Starbucks costs them $5,000 a year, just like they don’t comprehend that their EITC payment or nursing care for a loved one is part of vast federal spending protected by law that’s become unaffordable as both cost and demand skyrocket.
The dependency has become so normalized that people won’t allow Washington to touch it. Any elected official that so much as hints that they want to balance the budget by cutting these programs commits political suicide. The same American public that screams for fiscal irresponsibility is the same American public that votes them out of office when they try to reign this in.
The American public doesn’t realize it, but they’re running out of time.
The Fed’s rate hikes under Biden pushed the interest America pays on its debt to record levels that could equal the amount spent on defense in 2025. It’s a canary in the coal mine moment that indicates the financial cliff is closer than we think.
America cannot sustain balanced budgets for the future without cuts that are anathema to the American public. They blame profligate spending on $1,000 toilet seats, arcane studies on sexually confused salamanders, and pork barrel projects without understanding how their benefits contribute to the spending crisis in America.
If the government continues to pay for interest and defense spending, and the American people won’t tolerate a reduction in their entitlements, they can expect deficits as the status quo for the foreseeable future. There isn’t enough waste, fraud, and inflated military hardware to cut that can cover 2025’s deficit, which is predicted to cost between $2 and $4 trillion.
The question is, what happens first?
Will Americans have their come-to-Jesus moments where they willfully give up EITC payments that are now a part of their household budgets or welcome elderly parents to their homes for their end-of-life journey to balance the budget? Or do they keep the status quo until the unavoidable crash sinks America?
There is little hope for the former. My money is on the latter.
Brace for impact.
Chuck Mason (MDiv, Fuller Seminary) is a conservative Christian author and social commentator. You can read his perspectives at www.chuckmason.net.
image, Pixabay license.
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