The current state of the US economy is dire, with supply chain issues, high fuel prices, and inflation causing widespread concern. However, the looming economic crisis that could threaten the nation’s full faith and credit is even more alarming.
The US national debt has exceeded $31 trillion, 15 times higher than in 1984 when then-Senator Joe Biden warned of the potential for an economic disaster. Despite this, the current administration has failed to address the issue, missing the deadline to submit its budget proposal to Congress for the third year in a row.
Both political parties share the responsibility for the nation’s debt and deficit problems, and a fundamental return to fiscal sanity is required to resolve them. The first step is to curb federal spending, which will eventually hinder private investment, leading to slower economic growth and lower wages.
In addition, an increasing percentage of taxpayers’ money will be used to service the nation’s debt obligations rather than funding government services. By 2031, interest payments on the national debt will surpass defense spending, and by 2051, it will surpass the cost of Social Security and Medicare.
To avoid this scenario, a debt limit increase must be combined with meaningful federal spending action. New budget controls should be implemented alongside debt limit action, as Biden supported during his time in the Senate in the 1980s and 90s.
Bipartisan negotiations between the current administration and congressional Republicans, led by Speaker Kevin McCarthy, should be initiated.
Restoring fiscal sanity requires a return to fundamentals, including regular appropriations and spending levels. Appropriations Chair Sen.
Patty Murray and ranking member Sen. Susan Collins have committed to regular order, and the Senate Budget Committee should follow suit. The sooner spending levels are determined, the faster the broken processes can be restored.
Fixing the nation’s fiscal issues is critical for both economic and national security reasons, and the risks increase with each passing day.
Republican politicians are willing to work together to address the debt and deficit problems, but both parties must come together to find a solution. Failure to do so will result in fewer options for resolving the problem in the future.