It’s campaign season, so you’ve probably seen your fair share of political promises through your mailbox and the oversaturated airwaves. But as candidates exchange insults and point fingers, there is really only one promise that you should be looking for this November: “As your elected representative, I promise to do everything in my power to place our $16 trillion debt on a downward path.”
That’s a pretty straight-forward pledge, don’t you think?
Unfortunately, “straight-forward” and D.C. politics rarely come together — but that has to end. The country is addicted to borrowing money from the public and countries abroad instead of making the hard choices necessary to set it on sound financial footing into the future. That means being honest about what our largest entitlement programs and our biggest tax breaks will cost, what we are willing to pay for and even what we are able to afford as a country.
We have not been forthright about the trajectory of our debt or sincere about the changes needed in order to bend it downward. This has left our country facing the types of looming fiscal challenges that most people would associate with Europe.
Rising debt threatens our standard of living and the resources we will have in the future. Pick what’s important to you — whether it is federal highway, education or science spending or a low tax burden. Rising debt will empty resources out of the private economy and reduce the amount of resources available for critical programs within the federal budget. That’s the bad news. On the bright side, we still have time to implement policies that will slow the growth of this budget-devouring monster.
Here are the numbers you need to know: $16 trillion, $35,000, 218 and 60.
Earlier this year our national debt hit $16 trillion, a figure that continues to spiral out of control. The $16 trillion figure is actually two numbers. There is $11 trillion in debt that is held by the public — that’s us. Another $5 trillion is what’s known as intergovernmental debt. That’s the money that government “borrows” from another government agency. Think social security trust fund and you get the picture. Either way, it’s not good. Credit rating agencies are increasingly warning us of the dangers posed by our debt.
The next number: $35,000. That’s your share of the federal debt held by the public. That’s right. You and I and every other person in the United States owe more than $35,000. Each. But that figure relies on spreading around the burden equally to every person, including retired workers and children who are not part of the labor force. Spreading the national debt around only among working taxpayers increases the burden significantly. That does not include the $5 trillion of intergovernmental debt.
The next two numbers are where you and I come in. Those are the number of votes we need from Congress to do something meaningful on the debt. That’s 218 votes in the House of Representatives and 60 votes in the Senate.
But with all of these challenges comes opportunity. A new movement called the Campaign to Fix the Debt is seeking to encourage our elected officials to work together in order to find a bipartisan solution that will cut wasteful and low-priority spending, rewrite the tax code and reform our largest entitlement programs to preserve them for the next generation and even strengthen them for those who need them most. The Campaign to Fix the Debt is taking up the mantle from the Simpson-Bowles Commission, which recommended a series of budget cuts, tax reforms and entitlement changes to gradually put the debt on a downward path as a share of the economy.
Despite starting this summer, more than 180,000 Americans have signed the group’s petition at www.FixtheDebt.org, urging elected officials to find a plan that controls rising debt. Given the stakes, it’s a campaign that all Mainers should support.
The time has long passed for elected officials to stop issuing platitudes. Instead, we must take action. We have no choice but to face the reality that we must start paying for what we believe is important or else leave the economy far weaker than what it could be. I would encourage each of you to ask your elected officials and all of the candidates running for office to take the pledge and fix the debt.
Phil Harriman is a former state senator and a partner in the financial planning firm of Lebel & Harriman in Falmouth. He offers political opinion and analysis for news radio 560WGAN and the NBC affiliates in Maine. He and Ethan Strimling write a weekly column for the BDN called Agree to Disagree.