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New Credit Card Debt ---- $10,870
Existing Debt ---- $167,600
When I show that to people, they laugh and say the family is “irresponsible.” They are dismayed when I point out that those are really America’s budget numbers, with eight zeros removed:
Revenue ---- $2,450,000,000,000
Spending ---- $3,537,000,000,000
Deficit ---- $1,087,000,000,000
Debt ---- $16,760,000,000,000
Then people say: “That’s terrible! We have to balance the budget.”
Actually, we don’t need to “balance” it. We just need to slow spending growth to about 2 percent a year, so the economy can gain on our debt. But politicians won’t do even that.
I understand why. I ask people who say they are horrified by America’s debt, “What would you cut?” Most have no clue. They just stare. Some say things like, “Don’t cut education!”
C’mon. Federal bureaucrats spend $3.7 trillion! But most people can’t think of anything to cut?
When businesses face budget shortfalls, they can’t just give speeches about how much they care about fiscal responsibility -- at least not for long. They must make real cuts. When they do, they often prosper. Years back, IBM and GE each laid off 100,000 workers. People were furious. But thanks to those cuts, the companies survived.
If the politicians don’t know what to cut, they should just accept Sen. Rand Paul’s proposed budget. Among other things, he would cut four Cabinet-level agencies: Commerce, Housing and Urban Development, Energy and Education. Why not? We don’t need a Commerce Department. Commerce just ... happens. Education is funded by the states. The Energy Department gives money to politicians’ cronies.
I’d go further than Paul. Why do we need an Agriculture Department? Agriculture is done by farmers, not bureaucrats. Why do we need a Labor Department? And so on. All those things are better handled by a free market. I wish we had a real free market in America.
Government recently revised its dire forecasts about America’s coming bankruptcy. The numbers are a little better than once thought.
But make no mistake: As people my age retire and demand Medicare, America will eventually go broke.
The first step toward a solution is just being honest about the deep hole we’re in -- giving up on the lie that governments elsewhere failed with “austere” budgets. They haven’t.