America’s Most Serious Problem: Excessive and Growing Debt

 

I know that I repeat myself a lot. I am a fiscal conservative and social moderate.  This puts me in the middle of the political spectrum from left to right.  I support social welfare programs if they are legitimately helping the less fortunate among us.  I am especially supportive of programs for African-Americans because of the racial bias they experience.


Unfortunately our national leaders have collectively lost a sense of fiscal responsibility in recent years.  Looking at the standard debt chart (above) produced by the Congressional Budget Office, it is clear that indifference to debt commenced under President Reagan and has waxed and waned ever since.  The debt has been growing especially fast ever since the Great Recession in 2008 and now stands at 77% of GDP, the highest since the end of WWII.  Shrinking the debt (as a percentage of GDP) is now America’s most urgent problem.


As I have discussed before, it is the entitlement programs of Social Security, Medicare and Medicaid, as well as interest payments on our increasing debt which will continue to worsen the debt problem in the coming years  without strong corrective action.
All entitlement programs need to be reformed to impose cost control. Right now the two healthcare bills in Congress propose that the funding mechanism for Medicaid be changed so that it will be on a fixed (federal) budget from now on, rather than be continued in its current open-ended form.
Medicare is an even more expensive program than Medicaid.  It would be better to fix both of these programs at the same time, but it is better to fix Medicaid alone than to do nothing at all.
It would be even better to replace our employer provided healthcare system with a uniform, but limited, health insurance tax credit for all (including for the self-employed) and to make all of these major changes at the same time.  This would be the fairest way to proceed.

Conclusion. The current GOP plan to curtail healthcare costs could be much improved.  It is only a small step in the right direction.

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4 thoughts on “America’s Most Serious Problem: Excessive and Growing Debt

  1. Jack,

    You never consider lowering our defense budget. As I have said so many times, our wars since WWII have been defeats. We have gained no security in imposing them, but rather killed many millions of civilians as well as military personnel. Also we have no doubt that the upper classes have continued to prosper, whether it be the blip for them in 2007 or not. What makes you protect them?

    And, is it by coincidence that the darker skinner Americans are rarely a part of that upper crust? As a Conservative, are you trying to conserve their status? If so, why? How do you want their wealth to be expended?

    Doug

  2. Jack,
    Yes, there is a difference in being a fiscal ‘Conservative than a multitude of other conservatives. I am sure that you do support “prosperity for all Americans”. But I am troubled with the idea of conserving. I am not clear what is being conserved, except for the status quo.

    Doug

    • I will grant you that the terms liberal and conservative are not intrinsically accurate terms in politics. When I refer to myself as a fiscal conservative, it really only means that I want us to pay for what we spend (nationally, of course), rather than using deficit spending. Small deficits at the federal level are not a problem but we now regularly have huge annual deficits ($650 billion this year) which have accumulated into a total $20 trillion debt, which is so high it is scary to contemplate.
      All I want to do is to shrink our annual deficits down to as close to zero as possible.

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