As we work together to recover from an extraordinary public health and economic disaster, Congress must commit to reducing our national debt or face an even larger crisis with far graver consequences.
The perfect storm has been gathering for some time now. The largest generational retirement in human history, runaway healthcare costs, and record defense and domestic spending have generated a whopping $1 trillion annual deficit before COVID-19.
The record-high financial imbalances year after year have amassed a mountain of debt reaching $23 trillion by the end of FY2019. Prior to the coronavirus’s debut, the United States was on pace to pay out more in interest than all our national defense expenditures by 2028. At over one-quarter of a trillion dollars, interest paid to foreign bondholders such as China is among the fastest-growing expenditures in the federal budget.
America’s underlying fiscal condition was fragile prior to the pandemic, and it’s only getting worse. In April 2020, the nonpartisan Congressional Budget Office estimated that before the fiscal year ends Sept. 30, 2020, we will have added another $3.7 trillion to the debt. That figure doesn’t include the impact of any additional relief funding we expect in the next week or two.
By the end of September, CBO projects that the size of the federal government’s debt held by the public will eclipse our entire economy for the first time since the end of World War II.
The debt will continue to mount at an accelerating rate if we fail to include provisions in the next COVID relief package that force Congress to act before it’s too late. Our current path is unsustainable.
We need reforms to encourage responsible budgeting and reduce our dangerous levels of debt. To hand the country to our children in such disrepair is unconscionable. To give them no choice but to raise taxes to pay our bills when we were unwilling to temper our own appetites is unacceptable.
That is why Rep. Scott Peters, a California Democrat, and I led a bipartisan letter signed by 30 Democrats and 30 Republicans imploring leadership of both parties to adopt budget reforms now so we can get our fiscal house in order. Specifically, we asked Congress to fix the broken budget process to address growing deficits and debt as part of any additional pandemic relief legislation. We recommended improvements to transparency through an authoritative Fiscal State of the Nation report and testimony from the Government Accountability Office. We requested greater accountability through a debt commission focused on mandatory spending programs and their long-term liabilities. One option, the TRUST Act, would create “rescue committees” for major endangered trust fund programs such as Social Security and Medicare. Finally, we sought to replace the feckless debt limit with enforceable budget targets to reduce our debt-to-GDP ratio responsibly. I am very glad that was included in the Senate’s next relief package.
The longer Congress waits, the more difficult the decisions will be, and the closer to a sovereign debt crisis we get.
Over the past several months, Washington borrowed trillions of dollars to help millions of individuals and families who faced losing their livelihoods due to the virus. It was necessary to compensate people for decisions made by their government and to prevent a costlier, long-term disaster.
Even so, responding to an extraordinary crisis doesn’t mean Washington can continue spending money it doesn’t have.
Running up the debt is intergenerational theft. It poses unacceptable risks to our security, prosperity, and even civil peace. If we fail to include budget reforms that force us to deal with the looming debt crisis, no amount of money, borrowed or printed, will save us.
Rep. Jodey Arrington, a Republican, represents Texas’s 19th Congressional District in the U.S. House of Representatives.
