Why Millennials Should Support Me for U.S. Senate II. Our Appallingly Bad Fiscal Outlook

 

I am a candidate in the Nebraska Republican Primary for U.S. Senate against the incumbent Deb Fischer because she is ignoring out enormous and out-of-control national debt. In fact she has voted twice recently to make the debt much worse than it is already.
In my last post I made the case that debt is by far the biggest long term problem facing our country and that it will be a huge burden on future generations, starting with the millennials.
A new report from the Congressional Budget Office shows just how bad the problem really is:

  • To just stabilize our debt at the current level of 78% of GDP (for the public part on which we pay interest) will take a savings of at least $5.4 trillion over the next ten years. To achieve even this modest goal would require reducing annual deficits by roughly 50%.

  • To balance the budget by 2028 (allowing ten years to accomplish this) would take a savings of least $7 trillion over the next decade.  This would mean reducing annual deficits by $700 billion per year on average, an extremely difficult task.

Such numbers as these show how frightfully serious our fiscal situation is.   Our national leaders should be working hard to focus the country’s attention on this awful problem and how we are going to address it. Instead they won’t even come together to negotiate sensible annual budgets.

Conclusion. How will our debt problem be resolved? Will it take a new crisis to wake up the country to our extremely dire fiscal situation?  I prefer to be optimistic and hope for sensible action to head off a new crisis.  But there is absolutely no guarantee that common sense will prevail.

Why Millennials Should Be Interested in my Candidacy for U.S. Senate

 

From a reader of my campaign website:

I am a young voter, that was not of age during the presidential election, so I am doing my research to make sure I help make a wise voting decision for our state. I understand that your main focus is the debt, and I have read up on your other issues as well, but I wanted to ask you what makes you stand out from the other candidates. I have concluded that democratic candidate Ms. Jane Raybould and you have very similar stances on issues. So, I guess my question would be what can you do for our state that other candidates haven’t brought up. I am looking forward to hearing back from you.

Here is my answer to a young, open-minded, first-time voter:

I am an unconventional candidate because I am a fiscal conservative and a social moderate, specifically:

  • The national debt, now 78% of GDP (for the public part on which we pay interest), is the highest since right after WWII, and is predicted by the Congressional Budget Office to keep getting steadily worse without major changes in current policy such as curtailing the growth of entitlement spending.  This is by far the greatest long term problem facing our country. If we don’t address it, we will inevitably have a new and very severe fiscal crisis in the near future, as soon as interest rates return to normal (and higher) historical levels. Basically, we are in a deep hole, nonchalantly digging it deeper and deeper, when we need to devote all of our efforts to climbing out.
  • Social issues such as abortion policy, gun rights and immigration reform are highly contentious but do not fundamentally threaten our prosperous and stable way of life.  I am confident that the political process will eventually achieve an acceptable resolution of these social issues. I am far less confident that normal politics will get us out of our debt bind.

Conclusion. What distinguishes me from all of the other candidates in this race, Democratic, Libertarian or Republican, is my strong insistence that we must focus on solving our out-of-control debt problem. Otherwise the future of our country is at great risk.  Millennials will suffer most from inaction.

The 2nd Amendment and the National Debt

From a reader of my blog:
My biggest concern is your stand on the 2nd Amendment.  Just about all of us here in Western Nebraska own firearms.  There’s no way we’re gonna give them up.  You need to change your position, my friend.

I am a candidate in the May 15 Nebraska Republican Primary for the U.S. Senate against the incumbent, Deb Fischer, because she is ignoring our enormous and out-of-control national debt. In fact, she has just recently voted twice to make the debt even worse than it already is.  This is highly irresponsible because uncontrolled debt puts our peaceful and prosperous way of life at great risk.

Even though I am primarily focused on our debt problem, and how to solve it, there are other important issues in this congressional race and I have taken positions on many of them.

By far the most controversial position I have taken is to endorse a ban on the purchase of assault weapons. I have done so for the following reasons:

  • First of all, I strongly support the 2nd Amendment’s “right to keep and bear arms.”
  • The 2nd Amendment does allow some restrictions on guns. For example, guns are not allowed to be carried onto airplanes or into courtrooms.
  • We need to curtail mass shootings in the U.S. and I support the growing national momentum to get this done.
  • Stricter background checks on gun purchases and improved mental health treatment will help to some extent. But even with improvements along these lines, too many dangerous people will fall through the cracks and be able to acquire guns.
  • All mass shootings are carried out with semiautomatic assault weapons and so making them scarcer is the most effective action we can take to curtail them.

Conclusion. I am making an uphill effort to unseat an incumbent U.S. Senator because of my great concern about our horrendous national debt. But a candidate must take stands on many different issues and I am doing this.  I am not a threat to the 2nd Amendment and I hope gun owners will be able to understand this.

How Do I Persuade You that I Am Totally Serious about Fixing Our Debt?

From a reader of my blog:
Jack is the voice almost in the wilderness trying to warn us that we are deficit spending and borrowing ourselves into being Greece or even, eventually, Venezuela. He is a principled politician, almost an oxymoron today. I could go out and max out my three credit cards, around $24,000, on a big lavish trip somewhere. But I know better, because my credit would be shot and I would go bankrupt and end up living like a pauper. Maxing out our credit is what we are doing as a nation and there are severe consequences for that kind of irresponsibility.

I am a candidate in the May 15 Nebraska Republican Primary for U.S. Senate because the incumbent, Deb Fischer, is ignoring our enormous and out-of-control national debt. In fact, she has voted twice recently to make it much worse than it already is.
The question I am often asked is: “I agree with you about the debt and deficit spending but how do I know that you’ll be any better than all the other people who go to Washington and end up joining the establishment instead of opposing it, once they get there?”


Here is my answer:

  • I am a non-ideological fiscal conservative and have been writing about the debt and related issues consistently for several years on my blog “It Does Not Add Up.”
  • I am also a social moderate who is willing to take stands at odds with Republican orthodoxy such as endorsing a ban on the purchase of assault weapons as being the most effective way of curtailing mass shootings.
  • I am a retired UNO math professor and am not looking for a new career. If elected, I would focus on deficit and debt reduction from my first day on the job. It is unlikely that I would run for a second six year term.

Conclusion. I am confident that I will do what I say but how do I persuade the voters that I have the courage of my convictions?

Fiscal Issues vs Social Issues

 

I am a candidate in the May 15 Nebraska Republican Primary for U.S. Senate. The incumbent Deb Fischer is running for reelection.  She is a nice lady and represents Nebraska well in many respects.  For example she is on the Senate Agricultural Committee which is important to the Nebraska economy.
But there is one major way in which Fischer is falling down on the job.  She is ignoring our enormous and out-of-control national debt.  In fact she has voted twice recently to make the debt even worse than it already is.  The new tax law increases debt by $1 trillion over the next ten years even after new growth is taken into account.  The new budget deal could add an additional $2 trillion to the debt over the next decade.  Fischer voted for both of these items.  I want to emphasize as strongly as possible that this is why I am challenging her in the Republican Primary.


Of course, I have positions on other issues.  For example, I have recently endorsed a ban on assault weapons. But for me there is a huge difference between fiscal and social issues:

  • Our national debt, now 77% of GDP (for the public part on which we pay interest) is projected to reach 109% of GDP in just 10 years and to keep increasing way beyond that.  As interest rates rise to more normal historical levels, interest payments on the debt will increase by hundreds of billions of dollars per year. This will almost surely lead to a severe fiscal crisis in the relatively near future, causing huge damage to our economy, unless we make major changes in current policy.
  • Social issues are much different. They will eventually get resolved through the normal political process. Mass shootings in the U.S., for example, are intolerable to an overwhelming majority of Americans. If the NRA continues to oppose sensible changes in gun regulations, then many of its Republican supporters will eventually be replaced by Democrats who will enact the needed changes.

Conclusion. Our rapidly growing national debt will lead fairly soon to an existential crisis if left unattended to. The problem of mass shootings (as an example of a festering social problem) will be resolved by normal political processes.

Why the U.S. Debt is so Scary II. A Crisis Could be Nearer Than We Think

 

I am a candidate in the May 15 Nebraska Republican Primary for the U.S. Senate because the incumbent, Deb Fischer, is doing nothing about our enormous and out-of-control national debt. In fact, she has recently voted twice, for the new tax law and budget, to make our debt even worse than it already was. My last post quotes a reader of my blog as saying that deficit hawks need to make our soaring debt sound scary to ordinary citizens who don’t understand how it will affect their own lives.
The analyst Desmond Lachman from the American Enterprise Institute makes it sound even scarier by predicting a new 2008-2009 style crisis within the next year.  According to Mr. Lachman there are two basic reasons to fear another full-blown global economic crisis soon:

  • First, we have in place all the ingredients for such a crisis. The housing price bubble before the 2008-2009 crisis has been replaced by a global asset price bubble, for both stocks and bonds. A second key ingredient is that the global debt-to-GDP level is significantly higher than in 2008.

  • Second, due to major mistakes by the Federal Reserve and the U.S. Administration, the U.S. economy is in danger of soon overheating, which will bring inflation in its wake. With very low unemployment, the Fed has let low interest rates linger for too long. And the U.S. economy has now received a double fiscal stimulus with unfunded tax cuts and a new two-year spending boost.
  • The Federal Reserve now has two unattractive choices. It can raise interest rates quickly and burst the global asset bubble, or it can proceed at a slower pace and ignore the very serious inflation risk.

Conclusion. With a very high and rapidly growing national debt, along with unusually low interest rates which will be pushed up soon one way or another, we should prepare ourselves for another crisis in the near future.

The Key to Solving our Healthcare Cost Problem II. Make the Employer Mandate More Flexible

 

I am a candidate in the May 15 Nebraska Republican Primary for U.S. Senate.  I have entered this contest because the incumbent, Deb Fischer, has done nothing to reduce our enormous and out-of-control national debt and, in fact, voted recently (with the new tax law) to increase our debt by $1 trillion over the next decade.  And this is after new economic growth, stimulated by the tax changes, is taken into account.


One way to get the debt under control is with a more sensible budgeting process, but this is not enough by itself.


We also need a major effort to reduce the cost of healthcare.  One problem here is that employer provided health insurance is very inefficient, especially because it insulates employees from the full price of their healthcare. The way to fix this is to make the employer mandate in the Affordable Care Act more flexible in the following ways:

  • Replace income based tax credits in the ACA with aged-based tax credits (which then apply to everyone). See here for details.
  • Allow individual employees to migrate away from the employer plan to individually underwritten personal insurance. This will often save money for the individual employee (and family), the employer (who has fewer employees to cover) and the government (which has a smaller tax exemption). The employees also gain more flexibility for future employment.
  • Such a system, when fully implemented, will save $400 billion per year in government revenue, both state and federal.

Conclusion. I have outlined one way of moving from the defined benefit healthcare system we have now to a defined contribution system which will save hundreds of billions of taxpayer dollars every year by putting more responsibility on the individual health consumer.