A DECADE AGO, Americans clamored in outrage over the government’s growing mountain of debt. Today, as that mountain erupts to monstrous new heights, the clamor has been replaced with crickets.
As a presidential candidate, Barack Obama condemned George W. Bush for “driving up our national debt from $5 trillion . . . [to] over $9 trillion.” Such a sea of red ink was “irresponsible” and “unpatriotic,” he said, promising that as president he would shrink it.
As soon as he was inaugurated, Obama began aggressively lobbying Congress to adopt a vast “stimulus” package to revive the economy and put Americans to work. Congress obliged with one of the most gargantuan spending bills in US history. The stimulus failed to stimulate and unemployment went up, not down. But that didn’t stop Washington from continuing to spend money at an unprecedented rate, dragging the nation deeper and deeper into debt to pay for it.
If Bush’s fiscal record had been “irresponsible,” Obama’s was heedlessly rash. On his watch, annual budget deficits surged past $1 trillion. The national debt streaked upward, reaching nearly $20 trillion by the time he left office. Entitlements metastasized, consuming two-thirds of the federal government’s outlays.
And millions of Americans, alarmed by such fiscal recklessness, were galvanized. The Tea Party movement rose from the grass roots to stand athwart the unbalanced budgets, yelling “Stop!” Pitched battles were fought over increasing the government’s debt limit, which was raised only after Congress and the president agreed to a budget “sequester” to force automatic cuts in spending. Under pressure from constituents, lawmakers created a so-called Supercommittee with a mandate to reduce the federal deficit.
In the end, neither the sequester nor the Supercommittee nor the Tea Party cured Washington’s addiction to spending money it doesn’t have and incurring debts it can’t repay. But at least for a while, the government’s profligacy and mounting debt were salient political issues, which both parties were compelled to acknowledge and grapple with.
Yet today, with federal outlays and the national debt more out of control than ever, no one seems to care. Not President Trump, though he disparaged the growth in debt when Obama was president and claimed he would have no trouble eliminating the “U.S. Debt Deficit” if he were president. Not Congress, which has authorized $4.7 trillion in spending for the coming fiscal year — a $700 billion increase just since 2017. Not the voters, who, according to opinion polls, worry much less about federal spending and the deficit than they used to.
And especially not the men and women running to replace Trump, with their multitrillion-dollar plans to wipe out student debt, guarantee housing for everyone, eliminate racial inequality, address climate change, pay a $1,000 monthly stipend to every American adult, and replace private insurance with “Medicare for all.”
“The 2020 presidential campaign is in full swing, yet debt and deficits have barely been mentioned,” laments Peter Suderman in Reason magazine. “American politics has been overtaken by a free-spending sense that debt and deficits Just. Don’t. Matter.”
In Trump’s first 30 months as president, the national debt has ballooned by a further $2 trillion. For the first time since World War II — when the United States waged a life-and-death struggle to save civilization — the government’s debt ($22.02 trillion) is bigger than America’s entire economy ($21.06 trillion).
In other words, if every cent of market value created by the US economy this year — the entirety of the nation’s goods and services and products — were used to pay back the money that Washington has borrowed, the federal government would still owe a trillion dollars. To be sure, many American families with mortgages owe more money than they make each year. But private homeowners steadily reduce their debt and eventually pay it off. The federal government, by contrast, hasn’t gotten its debt down by a net nickel: It keeps borrowing more each year, saddling American taxpayers with a debt that keeps going up.
In the 1980s, the national debt amounted to 30 percent of US GDP; by the mid-1990s, it was up to 65 percent. Today we’re at more than 100 percent and rising. The interest on the debt will cost Americans almost $400 billion this year. And that’s at today’s super-low interest rates. If those rates go up — when those rates go up — the government’s interest obligations will skyrocket. By 2025, former Pennsylvania Governor Ed Rendell and Maya MacGuineas of the Committee for a Responsible Federal Budget have projected, interest on the national debt will surpass the defense budget.
This is madness. Americans are up to their necks in red ink, yet all the political class wants to talk about is how much more money the government can spend. Our most pressing domestic issue isn’t health care or housing; it is the gargantuan national debt slowly strangling America’s future. We can avert our eyes and pretend not to see what’s coming. But ready or not, here it comes.