I write this down now as a new Congressman because we all deserve to know that we have been lied to. Nowhere are our debt problems more serious than in the area of Social Security, Medicare and Medicaid. Today, they consume just less than 2/3rds of the federal budget and with a tidal of wave of Baby Boomers about to retire, that number will soon be uncontainable. By 2040, 75 cents of every dollar (taxed at current levels) will go toward paying for promises made under these three programs.
Compounding the problem is the fact that we borrow and print money to pay for these programs and the rest of the federal government. When the federal government borrows money to pay for today’s benefits, we are passing a tax increase along to our children and grandchildren. In fact, I call it a “birth tax” because every baby born today owes $45,000 as his share of the public’s debt. Moreover, every taxpayer alone owns $127,000 of the debt.
Our unsustainable debt burden is also a national security and sovereignty problem. Unlike in the past when we had high debt levels, now, nearly half of the debt is owed to foreign nations that have their own interests in mind – not ours.
Assuming we don’t want to fold as a nation, we are going to have to pay the money back. And that means there are few options. Saving money by significantly reducing spending on these programs is the most effective one. By definition, there are difficult choices to make when one saves but everything -- including eliminating wasteful defense spending – should be acted upon.
Some believe that cutting defense spending, foreign aid and earmarks will alone solve the problem. The magnitude of the debt problem has far exceeded this as the solution. Even if we completely eliminated the Department of Defense, Congress, its staff and all federal agencies, we wouldn’t come close to solving the debt crisis. Even under that scenario, autopilot spending on Social Security, Medicare and Medicaid will completely consume our revenue in just a few years.
Raising taxes isn’t the answer because raising taxes just results in lower economic output. As the old adage goes, “if you want less of something, tax it.”
Instead, we should lower taxes and remove the overzealous boot of government from the neck of the private sector in addition to real, aggressive reform of the Social Security, Medicare and Medicaid programs. We should incentivize more domestic energy production, which would all lead to above average economic growth and reduce our debt faster.
We must commit ourselves to real reforms that make our government more efficient and effective. Having a needs test for healthcare, whereby only individuals who truly need service get it, is one important reform. Another is to raise the age of Social Security, leaving a new system for younger people from which to benefit. These are all ideas that constituents have already talked to me about. They are not scared to make these changes if guaranteed that their sacrifice would help their kids and grandkids – and that they are equitably applied. And, by the way, the high school kids I talked with are on board with this reform too. They already know that their so-called “entitlement” programs won’t be there for them anyway – unless we act now.
Rep. Todd Rokita (R-Ind) is a member of the House Education and Workforce Committee.