America’s national debt is out of control, and the youngest Americans and future generations will likely pay the biggest price. That’s one takeaway from new Long-Term Budget Outlook report by the Congressional Budget Office.
The agency’s long-term budget projections are bleak, with debt nearly doubling over the next 30 years. Yet we could avoid this ruinous fate if Congress reins in its sugar daddy propensities and prioritizes spending so that taxpayer dollars support truly essential constitutional functions.
Lawmakers serious about doing this need look no further than The Heritage Foundation’s Blueprint for Balance. It shows Congress how it can balance the budget in 10 years and start paying off the national debt.
The first step to fiscal recovery is to implement strong spending restraints that force Washington to live within its means. Ever-growing entitlement spending and interest payments on the national debt are the two areas where spending is most out of control. Together, they are projected to account for nearly three-quarters of federal spending growth over the next decade.
Medicare spending is projected to double in the next 30 years. Over the same period, Social Security and other health care programs are projected to grow by 26% and 43%, respectively.
As America racks up more debt, it becomes more expensive to pay the interest. The CBO estimates that, next year, Washington will spending more on interest payments than on Medicaid. In just six years, interest payments will outstrip defense spending. By 2041, CBO projects that entitlement spending and interest payments on the debt will consume all federal revenues.
One difficulty in getting entitlement spending under control is that it is on “autopilot” — Congress doesn’t exercise direct control over the funds from year to year.
However, Congress does control the other third of the budget known as discretionary spending.
Since 2012, discretionary spending has been limited through the Budget Control Act’s spending caps. Unfortunately, Congress’s will to limit discretionary spending has been weak, leading to three budget mega-deals that have raised the caps by $440 billion over six years, with little of the new spending being paid for. The long-term debt implications of the deals is likely trillions of dollars.
The discretionary limits are set to expire in 2021, but some lawmakers would like to see one more deal to push the caps even higher. Earlier this year House Democrats put forth a plan to raise the caps by over $350 billion for the next two years. There was no plan to pay for it.
If lawmakers want to start fixing the nation’s debt problem, they should start by rejecting another cap-raising deal and instead prioritize spending on essential federal functions, like national defense, while cutting other programs.
To truly stabilize the budget and pay down the national debt, discretionary cuts won’t be enough. Congress must implement reforms to lessen the costs and ensure the long-term viability of Social Security, Medicare and Medicaid.
The sooner Congress starts these reforms, the better off young Americans will be. The longer Congress waits, the more significant and abrupt the policy changes (i.e. cuts to benefits, higher taxes, or both) will have to be.
CBO suggests that younger Americans — and those yet to be born — would pay the heaviest price for Congressional inaction. The report states: “Delaying policy changes would reduce the well-being of younger generations compared with a situation in which policy changes occurred earlier.”
Future generations would likely have lower incomes than their parents and see less economic opportunity throughout their lives.
To ensure our country’s continued prosperity, Congress must implement a strong budget framework that reduces the national debt and restores sanity to budgeting. If lawmakers fail to do so, we will all pay a price, but our children and grandchildren could pay the highest price of all.
This piece originally appeared in The Washington Times