Twenty-five years ago, the United States faced a budget deficit of more than $200 billion and a reported national debt of $4.7 trillion. These troubling figures were top of mind that autumn when a group of politicos gathered on the Capitol steps and conservative icon Newt GingrichNewton (Newt) Leroy GingrichMORE made the case for desperate measures to match the desperate times. He laid out one of the most ambitious legislative agendas since Franklin Roosevelt’s New Deal: Within the first 100 days of a new Congress, Gingrich promised to launch a comprehensive audit of the U.S. government, implement zero-based budgeting and a balanced budget requirement, and enact a slew of other reforms aimed at restoring faith in the U.S. government.
“This is truly a historic event,” Gingrich proclaimed to the assembled Capitol Hill reporters in October 1994. Gingrich branded his agenda a "Contract with America" — a solemn pledge to “restore fiscal responsibility to an out-of-control Congress, requiring them to live under the same budget constraints as families and businesses.” It was a deal that the American people were happy to take — public opinion polls showed that 60 percent of voters supported all ten of Gingrich’s specific policy proposals.
When voters headed to the ballot box that year, they handed the GOP dozens of new seats and majority control of Congress for the first time in four decades, a landslide that media commentators would refer to as the Republican Revolution. But within a year of Gingrich becoming speaker of the House in January 1995, the ten-point legislative agenda had largely stalled.
The insurgent House class of 1994 had a mandate to govern but was stifled by the bureaucratic inertia that preserves business as usual in Washington’s power structure, as well as judges, Republican Senate committees and Democratic opposition votes. Only tort reform, enhanced welfare requirements for teen mothers and a handful of other minor provisions ever made it into law.
A quarter of a century later, the dire financial situation in the 1990s could now pass as the good old days. Budget deficits for 2009 through 2012 were more than $1 trillion each year, and the 2019 budget deficit is expected to be $960 billion. Federal spending has exploded by more than $17 trillion since the Republican Revolution of 1994, sending the reported debt up to $22.5 trillion in 2019.
Various tax cuts, wars in Iraq and Afghanistan, the prescription drug benefit, health care reform and the 2008 recession have all contributed to this dramatic rise. But this official debt amount is vastly understated because it does not include all the social insurance promises made by programs such as Social Security, Medicare and Medicaid. When taking all the current outstanding liabilities into account, the true federal debt is over $119 trillion.
In the modern political context, you would be hard-pressed to find lawmakers of either party who would sign onto a pledge like the Contract with America. The implementation of zero-based budgeting would pose an existential threat to the Washington status quo. For the last several decades, Congress has made a habit of governing by continuing resolution. With this year’s budget automatically determined by the last year’s budget, politicians avoid fixing their names to politically sensitive spending cuts. Zero-based budgeting would have ended that, requiring an annual justification for all appropriations as if the process were starting from a blank slate.
On the bright side, the Contract did bring about a new awareness among the American people of the government’s shaky finances. Voters today still believe there is a need to come to grips with Social Security and Medicare, and recent polling has found that 83 percent of Americans want their elected leaders to sharpen their focus on the national debt.
But President TrumpDonald TrumpJan. 6 panel plans to subpoena Trump lawyer who advised on how to overturn election Texans chairman apologizes for 'China virus' remark Biden invokes Trump in bid to boost McAuliffe ahead of Election Day MORE and the 2020 Democratic presidential candidates are hardly mentioning the national debt. Moderators at the debates haven’t even brought up the issue.
Twenty-five years after the Contract with America, it’s time for our presidential and congressional candidates, as well as the media, to focus on our national debt. To make knowledgeable voting and tax and spending policy decisions, citizens and their elected officials need accurate information about our country’s true national debt.
Sheila Weinberg, CPA, is the founder and chief executive officer of Truth in Accounting, an organization that researches government financial data and promotes transparency for a better-informed citizenry. Follow her on Twitter @Sheila_Weinberg.