America is almost broke
Most people know our country is going through difficult economic times, virtually on all fronts. The worst may be yet to come. Our debt is unsustainable. The government can’t stop spending our money. The recovery is looking more and more like a jobless one. Inflation, home values and investments are unpredictable. And, the world financial markets are warning us that America is headed for trouble. Is there a solution?
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The president’s deficit panel is proposing saving $3.8 trillion by 2020. This is about half the projected growth of the national debt. Rather than a real savings, the plan only slows the growth of our soaring debt. Besides eliminating middle-class tax breaks, reducing spending for Medicare and Social Security are major elements of the plan. This is not comforting to working people and the growing 65+ population.
Since this is the initial salvo in what is hoped to be a lively debate, it is too early to determine what elements of the proposal will stick and what will be discarded before the hard work of putting together a hopefully bi-partisan piece of legislation in the Congress. The problem that remains is how quickly the cost savings can be realized.
A cut in discretionary spending and reducing the federal work force by 10% could be put in effect by 2015. However, the Social Security changes don’t kick in until 2050, when the retirement age is raised to 68 and to 70 in 2075. This means the people who will have to wait until they are 70 to collect benefits have yet to be born. By then life expectancy could be 150 and people may be able to work until they are 100, unless the government devises a way to implement the death panel as part of its Medicare savings plan.
Could a simple, more direct approach provide a fast and effective solution for getting the budget under control? The reduction of 10% in the government employment ranks is a good start. However, federal employees are making more and receiving higher benefits and substantial pensions compared to the private sector. This discrepancy needs immediate realignment.
The 10% savings idea is one that might be extended across the board in Washington. Every budget in every department of every branch of government should be slashed by 10%, immediately. Anyone who says it can’t be done has never run a business or tried to balance a family budget. If the money is not appropriated, the cuts will have to be made.
Then, those responsible for the federal budgets should go back through each of the individual budget and determine were an additional 10% might be saved. Why is this aggressive approach necessary? In fiscal year 2009 the government spent $3.5 trillion, up 18% from the previous year. So we must stop the bleeding.
We can’t wait any longer. It is time to realize saving, reduce the deficit and get spending under control. Because, if we don’t do it today, America will not be broke tomorrow it will be bankrupt.
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