It took forty-one Presidents and 216 years for the United States to accumulate our first $3.7 trillion in national debt. It took President Obama less than two and a half years to accumulate the same amount of debt. Even more astounding is that under the President’s 2012 budget proposal, the federal debt would increase from approximately $10 trillion on the day he was inaugurated to $20 trillion by the end of his potential second term. These debt numbers are staggering, which is why the debt ceiling debate currently going on is so important.
Economy & Budget
A letter from the Strengthen Social Security Campaign to the members of the House of Representatives.
We write to oppose both “The Cut, Cap, and Balance Act of 2011” and any Balanced Budget Amendment (BBA) proposals, on behalf of the Strengthen Social Security Campaign, which is comprised of 320 organizations representing more than 50 million members from many of the nation’s leading aging, labor, disability, women’s, children, consumer, civil rights and equality organizations.
Today the House will consider legislation that would force the nation to default on our financial obligations for the first time in history unless Congress adopts a radical new constitutional amendment.
That amendment would impose arbitrary, reckless budget caps that would – without a doubt – force massive cuts to Medicare, Social Security and other crucial benefits. At the same time, it would constitutionally protect wasteful loopholes and tax breaks for millionaires and billionaires.
To meet an arbitrary spending cap frozen at 18 percent of Gross Domestic Product, it would shrink benefits and services back to levels not seen since 1966. In 1966, Medicare was one year old and there were 100 million fewer people in this country.
Today, members of the House of Representative will have a chance to stand up and be counted. They’ll show with their votes whether they believe in freezing Washington’s current spending habits in place, and raising job-killing taxes. Or whether they believe, as I do, that the reckless spending and debt of the past two years has brought us to the point of crisis, and that something serious must be done to rein it without damaging a fragile economy with job-killing taxes. It’s that simple.
For too long, leaders on both sides of the aisle have allowed spending to run rampant in the nation’s capital. As a result, the national debt has soared above an unprecedented 14 trillion dollars, we are borrowing roughly 40 cents of every dollar, and our country’s credit rating is at risk.
America is at an impasse, and it’s time for Washington to do what is right.
Nevada Senator Harry Reid made the following remarks today on the Senate floor regarding Senate Democrats' meeting last week with Treasury Secretary Tim Geithner:
Senate Democrats sat down with Treasury Secretary Tim Geithner, and he painted a picture of what our world will look like if Republicans in Congress force this nation for the first time in its history to default on its financial obligations.
The picture was grim. This is how he described the state of our government if Congress allows this unprecedented default: "lights out."
He said default would result in a complete "loss of capacity to function as a government."
The debt ceiling debate is providing plenty of opportunity for political theater in Washington. Proponents of raising the debt ceiling are throwing around the usual scare tactics and misinformation in order to intimidate opponents into accepting more debt and taxes. It is important to distinguish the truth from the propaganda.
First of all, politicians need to understand that without real change default is inevitable. In fact, default happens every day through monetary policy tricks. Every time the Federal Reserve engages in more quantitative easing and devalues the dollar, it is defaulting on the American people by eroding their purchasing power and inflating their savings away. The dollar has lost nearly 50 percent of its value against gold since 2008.
U.S. Senate Republican Leader Mitch McConnell made the following statement on the Senate floor Monday regarding the need to pass legislation that would cut government spending now, cap it in the future and approve a constitutional amendment to balance the federal budget:
This is a pivotal week for America.
Two years of reckless spending and debt have brought us to the point of crisis. And this week, Americans will see how their elected representatives decide to resolve it.
On the one side are those who believe that failing to rein in spending now could be calamitous, and that a government which borrows 42 cents for every dollar it spends needs to sober up. Washington needs strong medicine to heal its spending addiction now, not a false promise of it later.
And on the other side are those who want to pretend the status quo is acceptable — that everything will be fine if we freeze current habits in place, raise job-killing taxes on small businesses, and do nothing about the long term fiscal imbalance that imperils our economy.
Last Wednesday, I had the opportunity to listen to Chairman Ben Bernanke of the Federal Reserve as he testified on monetary policy and the economy before the House Financial Services Committee. His testimony sparked a robust dialogue on the economy, deficits and the debt ceiling, and I opine on those topics in this guest piece in The Hill.
When discussing economics, people in Washington often attempt to categorize themselves in one of two camps: “Keynesians” and “monetarists.” I believe, however, that effective navigation of the economy requires applying a combination of both fiscal and monetary policy. Chairman Bernanke’s testimony inspired me to analyze this issue once again.
With our nation currently facing a $1.5 trillion budget deficit, it is clear that Congress needs to make wise investments when it comes to spending taxpayer dollars. It is incumbent upon our elected officials to evaluate all programs and eliminate those that are not producing results and fund those which provide a clear return on investment.
If we are to have a sustained economic recovery and ensure the ability of our nation to compete in the global marketplace in the future, no issue is more important than the education of our future workforce. Many generations ago, one could obtain a decent paying job without a post-secondary education. That time has passed. Economic shifts have made it increasingly difficult for those without a high school education to advance in our society and our global competitiveness has suffered.