Editor’s Note: David Grasso is the anchor of “Bold Business,” a digital television show about millennial economic empowerment. He has been an investigative reporter for Telemundo and local ABC affiliates in Florida and Texas, and he holds a master’s degree in public policy from the Harvard Kennedy School. The opinions expressed in this commentary are his.
Trillion dollar deficits, once considered a temporary stimulative measure aimed at healing the wounds of the Great Recession, are becoming accepted as business as usual in Washington.
As budget deals are hashed out and both parties reach common ground on issues that affect all Americans, talk of fiscal discipline is curiously absent. It appears we’ve reached a new bipartisan consensus that’s troubling for the taxpayers of tomorrow – in Beltway politics, deficits don’t matter anymore. As a 33-year-old, I’m one of those who ultimately will have to pay the price.
Nearly a decade ago, red ink was splattered all over our nation’s balance sheet, and that caused an uproar among countless Americans. The federal government blew a gaping hole in our budget, funding unprecedented efforts to stabilize the economy on the heels of a near-depression.
Today, while prosperity and stability have been restored, Washington has once again come to rely on what’s being treated as an infinite supply of debt just to fund regular operations. In the midst of the best economy we’ve seen in recent years, instead of saving for a rainy day, we’re pursuing policies that are creating ever-yawning public deficits.
Our leaders are purposefully turning a blind eye to our growing liabilities as a nation to strike politically expedient budget deals. In the short term, legislative deal-making funded with future generations’ money is an astute strategy to avoid government shutdowns – which have happened twice this year.
In the long run, however, if we continue to ignore the consequences of our addiction to borrowed money, we’ll see an increasingly larger slice of our budget siphoned off just to pay interest on the debt. This is why deficits should matter: They eat up future revenue that we desperately need as the costs of already promised entitlements continue to spiral upward.
Right now, more than 10,000 baby boomers are retiring daily. People like my parents have been guaranteed government benefits to fund their golden years because they’ve paid into the system their whole lives.
The federal government’s obligations are already on track to strain our nation’s budget for the foreseeable future. Needless to say, sustaining our newly christened trillion-dollar deficits will surely not improve our government’s budgetary prospects.
Additionally, the surging costs of entitlements aren’t the only monetary problem the government faces in our immediate future. Our national infrastructure is in desperate need of a fiscal shot in the arm. Many suspect that a substantial (and wise) investment in upgrading the backbone of our economy is on the policy horizon. Where exactly the funds will come from is still in question, especially when the federal government is already borrowing an eye-popping amount of money this fiscal year.
Make no mistake: Persistent federal deficits will create politically difficult decisions down the road. As it stands, the lion’s share of our budget already is gobbled up by entitlements and military spending. That leaves little wiggle room for any other meaningful allocations without damaging our fiscal health.
Even worse, if we encounter more economically turbulent times, the federal government likely will see its revenue drop precipitously. As a result, the public purse will have to borrow merely to sustain present spending levels. If we see another financial crisis, many politicians and economists will call for another round of rescue-driven stimulus, and we’ll see our deficits creep ever higher.
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Borrowing cannot be sustained forever, and there are some prominent voices clamoring for us to address our federal government’s addiction to debt. Alan Greenspan, the former chairman of the Federal Reserve, and Sen. Rand Paul are figures who have unequivocally expressed their concerns on this front, and they blame both major political parties for their lack of focus on fiscal discipline. We can only hope that more leaders like Greenspan and Paul will step forward and explain to the public the dismal state of our government finances.
Most Americans are fiscally conservative and would be aghast at the current state of affairs if they were in the know. Unfortunately, few people can truly grasp the gargantuan size, mathematically, of $1 trillion.
Debt is an important part of a modern economy, and it should be a tool that our country uses to make strategic investments in our future. Trillion-dollar deficits shouldn’t be leveraged to secure short-lived, partisan budget deals that kick the can further down the road. Leaving a fiscal mess for tomorrow’s taxpayers is a toxic legacy that our elected leaders should avoid at all costs.