The Invented Crisis – Let’s Forget the Drama & Stop Overspending
Is it a crisis and did it need to be? We won’t really know until we “default.” Actually, it won’t be a default, it will be a government shutdown. The government officials know we are not facing a default and they know Social Security has to be paid by law, though they’d have you believe differently. Would we really miss some of these government agencies if they shut down for a bit?
Did we really need to get here?
Is the debate about raising the debt ceiling or about government overspending?
Borrowing to pay for our expenses, particularly wars and entitlements, has been going on since the Revolutionary War. Each war has increased our debt. During the depression and after, entitlement programs added to the debt. The Vietnam War was pivotal in that the government continued to spend after the war.
During the 90’s, Ross Perot raised awareness of the danger that would ensue from our reckless spending. We quickly sank back into our stupors when the economy picked up. The borrowing and spending revved back up.
George Bush needed to raise the debt ceiling in 2006. Then Senator Barack Obama was vehemently opposed. His comments from 2006 and his recent comments follow.
In 2006, then Senator Barack Obama said, “The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. Government can’t pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies…
..Over the past 5 years, our federal debt has increased by $3.5 trillion to $8.6 trillion.That is “trillion” with a “T.” That is money that we have borrowed from the Social Security trust fund, borrowed from China and Japan, borrowed from American taxpayers. And over the next 5 years, between now and 2011, the President’s budget will increase the debt by almost another $3.5 trillion…
…Numbers that large are sometimes hard to understand. Some people may wonder why they matter. Here is why: This year, the Federal Government will spend $220 billion on interest. That is more money to pay interest on our national debt than we’ll spend on Medicaid and the State Children’s Health Insurance Program. That is more money to pay interest on our debt this year than we will spend on education, homeland security, transportation, and veterans benefits combined. It is more money in one year than we are likely to spend to rebuild the devastated gulf coast in a way that honors the best of America…”
In a July 11, 2011 news conference, President Obama said, “…the good news is that all the leaders continue to believe, rightly, that it is not acceptable for us to not raise the debt ceiling and let the U.S. default…”
President Obama’s statement is inaccurate. We are not facing a default. We are facing a government shutdown. The government needs to cut 40% and that will shut down the government.
At 3:20, Monday, the Senate Democrats unveiled a 2.7 trillion dollar spending cut plan that includes large savings from domestic and defense programs to try to break the impasse over raising the government’s $14.3 trillion debt limit. It gives the government enough money to make it to 2013 so it basically kicks the can down the road again. The cuts are not real cuts but more on that later. Not to worry, there could be a new plan by 4:20. Read here: Senate plan