The Importance of Curbing Deficit Spending: Insights from 5 Informative Charts
Both chambers of Congress are currently embroiled in heated debates over spending legislation. The Senate has managed to garner bipartisan support for a “supplemental” package, although it faced opposition due to flawed border and immigration provisions. However, the package’s hefty $95 billion price tag, with $60 billion allocated to Ukraine, is expected to face stiff resistance in the House.
In addition to the supplemental package, Congress is also working on regular spending bills, known as appropriations, that fund national defense and federal agencies. The most recent deal ensures funding for part of the federal government until March 1 and the rest until March 8. Nonetheless, there are concerns about whether these bills will be transparent or if they will include gimmicks, such as “emergency” spending, to deceive the public.
However, these spending bills are not occurring in isolation. Decades of budget gimmicks, spending sprees, and handouts to far-left institutions have placed America in an unsustainable position. This predicament is depicted in a series of charts that highlight the importance of curbing deficit spending.
Running deficits has become a common occurrence for the federal government. The size of these deficits also plays a crucial role in shaping the economy. When deficits become too high, as was the case during the COVID-19 pandemic, it adds inflationary pressures to the economy. If current trends continue, deficits will expand even in years without recessions or major wars.
In 2009, the first-ever $1 trillion deficit occurred, which triggered the rise of the tea party movement. Astonishingly, $1 trillion deficits have now become standard practice, and projections indicate that the federal government will reach $2 trillion deficits annually by 2031, or even sooner if additional legislation expands government spending.
Years of substantial deficits have contributed to the exponential growth of the national debt. In comparison to the size of the economy, the public national debt is nearly as large as it was during World War II. However, there is a crucial distinction between then and now. After the war, federal spending decreased, and the debt started to recede. In contrast, most current federal spending is allocated to categories where the government has made firm commitments for the future, such as Social Security, Medicare, and interest on the debt. These categories represent the majority of expected spending growth, which drives long-term debt and deficits.
Both the Social Security and Medicare trust funds are on the brink of depletion within the next decade, a concerning reality that most of Washington prefers to avoid discussing. While it is possible to find ways to save money on these programs while preserving the core safety-net aspect for seniors, addressing these imbalances will necessitate political courage.
The recent rise in interest payments is another alarming consequence of the growing national debt. Shockingly, the Congressional Budget Office has revealed that by 2024, the federal government is projected to spend more on interest payments than on national defense. If debt and deficits continue to spiral out of control, this trend will persist. Interest payments do not contribute to protecting the nation or funding public investments but instead represent the consequences of previous big-government spending.
If Congress fails to take action, rising interest costs will snowball and pose a threat to the fundamental aspects of the entire economy. However, legislators have an opportunity in the coming weeks to start curbing deficits. This requires saying “no” to new deficit spending and considering real cuts in one area when there are potential increases in another. Additionally, eliminating earmark boondoggles that waste taxpayer money on political cronies and ineffective projects is essential.
Undoubtedly, changing Washington’s culture of easy money will not be easy. However, it is crucial for America’s fiscal health and prosperity. The importance of curbing deficit spending cannot be overstated, and it is vital for legislators to take the necessary steps to ensure a sustainable future.
Disclaimer: The views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.
