debt

The looming debt load will some day come a-crashing. But politicians are doing nothing — or nest to nothing — to stop the growth of the debt, and thus keep on piling on the extent and severity of debt.

So click on over to Townhall.com, to read this weekend’s column by Yours Truly, the purveyor of Common Sense, and then come back here for further reading.

• Ezra Klein’s Post piece
• Medicare’s future, as understood by the trustees
• The Ben Franklin misattribution
• The Alexander de Tocqueville misattribution
• Who Is Alexander Fraser Tytler?

As I write this, the United States of America is $16,275,179,205,442 in debt. By the time you read this, we’ll have piled up millions more.

Much debt is of recent vintage. When George W. Bush became president in 2000, the national red ink totaled $5.7 trillion. In eight years, Dubya nearly doubled it to $10.6 trillion. Since his 2008 election, President Obama has far outpaced Bush, sinking us another $5.3 trillion in debt in just half Bush’s time.

And, by continuing to run yearly deficits of over $1 trillion, we’re digging the hole deeper at top speed.

For all the hysteria over draconian cuts, forced at the so-called fiscal cliff, those somewhat slippery savings would at best amount to about 10 percent of our yearly deficit, leaving us spending 9/10ths of a trillion dollars we don’t have.

In the “other cuts” department, the Obama Administration had been supporting paltry reductions to federal Medicaid spending of $17.6 billion over ten years (that’s less than $2 billion a year), but just flipped its position. Why? State governors are deciding if they can afford to take part in Obamacare’s massive Medicaid expansion to cover those earning up to 133 percent of the poverty line.

Not content to spend recklessly alone, the Feds picks up the entire tab of new Medicare recipients’ first three years. After that, Washington pays 90 percent and the states pay 10.

States are wondering how they’ll come up with that additional 10 percent — seven governors have already declined to join in the spending program. No one in Washington has given a second thought to paying the 90 percent.

They figure they can always raise taxes.

This is Common Sense. I’m Paul Jacob.

Government tends to grow in spurts, with budgets not decreasing after each spurt. This “ratchet effect” of fast growth then tapering off amounts to a long-term trend: growth.

You’ve probably seen Rex Nutting’s MarketWatch squib, the subject of many a Tweet and Facebook post. Entitled “Obama spending binge never happened,” it begins, “Of all the falsehoods told about President Barack Obama, the biggest whopper is the one about his reckless spending spree.” Nutting reframes the issue as one of the rate of spending growth . . . just as Republican apologists did in the ’80s, even though spending under Ronald Reagan’s first term grew at a whopping 8.7 percent — a bigger rate increase than Obama’s. Nutting entitles his graph comparing administrations’ spending growth rates “Slowest spending in decades,” indicating not how much Obama has been spending over revenue, but year-to-year rates of increase.

The prez gets a bad rap.

Well, yes and no. The graph should make party-loyal Republicans and Bush admirers cringe with shame. Sure. But Obama and the current Congress are still spending. Hugely. And rapidly — those dollars fly out the door!

Further, by maintaining high annual deficits, Obama has increased the federal debt so that this year it has shot above 100 percent of current Gross Domestic Product, a first for my lifetime.

Obama can be blamed for not doing the decent thing after the horrible six years of united government under the Republicans, he didn’t reduce spending.

In other words, he’s no Warren G. Harding, who presided over a huge contraction of government spending, thereby helping usher in a quick recovery from the post-Great War bust.

We could use a man like Warren Harding again.

This is Common Sense. I’m Paul Jacob.

Barring drastic action, the Golden State will run out of cash in March.

There is no provision in the Constitution for dealing with a bankrupt state. But then, there’s nothing explicit dealing with federal bankruptcy, either. The founding fathers didn’t expect their republic to permanently accumulate debt. Indeed, Thomas Jefferson wished to foreswear all sovereign debt. He considered the practice parasitic.

Our leaders are supposed to run our governments so to avoid debt crises.

But, because politicians do just the opposite, they run into cash flow crunches. Last year, California’s statesmen borrowed $5.4 billion to cover the lean time before Spring’s tax revenues flowed in. They had figured they would be good through June, but miscalculated. Now they’re scrambling for an extra $3.3 billion.

Time to fudge the books! Pay late. Not answer the phone or respond to dunning notices.

Of course, the real problem is over-spending. California’s politicians spend too much.

Alas, it doesn’t look like they are about to reform.

Gov. Jerry Brown still pushes the huge “investment” of high-speed rail, for the grandest example. The project’s supporters have over-estimated ridership, underestimated costs (the most realistic official accounting now puts the system at $98 billion), and have been forced to restrict the extent of the line, excluding both San Diego and the state capital. Brown’s response? Making up for cost overruns by hijacking funds from the state’s “cap-and-trade” (the nation’s only carbon-footprint-based) tax.

Ah, politicians: Spend, spend, spend, even as the institutions they are responsible for lurch into insolvency.

This is Common Sense. I’m Paul Jacob.

There are two things I don’t understand.

Actually, there are many things I don’t understand, but what I’m thinking about, now, is how one can honestly defend massive government deficits in one of the two usual ways.

The first defense became a cliché while I still wore footsie pajamas: Deficits don’t matter because we owe the debt “to ourselves.”

The truth? More complicated. Some people buy debt; others don’t. Were we to “forgive us our debts” (to appropriate a familiar phrase), we wouldn’t be forgiving what we owe “us,” but what the “U.S.” owes just those investors who’ve bought that debt.

And not even “everybody” owes the debt, since the taxes that would be collected, extra, to pay the debt might not come out of your pocket, or mine — it’ll come out of those pockets, over there. (Of course, you’re probably thinking, “I should be so lucky!”)

No wonder government debt is so tempting. On the surface it’s all inclusive. “We’re all in this together.” But beneath, it’s some folks trying to get one over on other folks.

Nasty, eh?

Then what about today’s excuse: “We owe it to folks overseas.” Since much of our governments’ debt gets bought up by investors abroad, we don’t have to worry about it because . . .

The unspoken thought is: “We’ll just renege on our promises.” Not pay it. Screw them.

Simple truth: Apologists for growing deficits flirt with mass theft from the government’s creditors.

This is Common Sense. I’m Paul Jacob.