By Sara Imhoff
The time of the year has come for holiday cheer and gift-giving. Unfortunately, gifts are not free and we are currently buying (federal) presents for ourselves and sending the bill (national debt) to our children — a process that runs contrary to traditional holiday values.
Today, our national debt is nearly $14 trillion, with last year’s federal deficit at $1.3 trillion. Future generations will be saddled with the bulk of this debt, even though they had no say in creating it.
As a nation, we will not be able to pay for all the federal benefits we have promised ourselves at the levels of federal revenue we’ve grown accustomed to. It is impossible, in fact; the current path is unsustainable. Tough choices will have to be made about spending cuts and tax reform.
In the past month, President Barack Obama’s National Commission on Fiscal Responsibility and Reform as well as the Bipartisan Policy Center’s Debt Reduction Task Force released their recommendations for reducing federal deficits and stabilizing the debt-to-GDP ratio at sustainable levels to keep the promise of America for our children and grandchildren. The reports from both commissions are meant to help keep America great — which it cannot be if it is broke — and to provide guidance on how we can continue to recover from the recent recession while also learning to live within our means.
The commissions included current or former elected officials, business and community leaders and national budget experts. They were able to agree on comprehensive plans despite the broad range of ideologies on each panel. And both groups’ recommendations would create a pro-growth tax system that reduces individual and corporate income taxes, strengthens Social Security in the next 75 years, and controls health care costs for individuals and families, business, and state and federal governments.
Still, far too many politicians, pundits and citizens exclaimed “No No No” instead of “Ho Ho Ho” when they realized that tough choices and shared sacrifice, both in terms of spending cuts and increased taxes, are required.
The possible elimination of popular tax deductions, the establishment of a new “debt reduction” sales tax, cuts to the defense budget, increased cost-sharing for many seniors receiving Medicare while paying doctors and hospitals less and a slow upward adjustment in the standard retirement age for Social Security benefits were not warmly received.
Adding to the coal in our kids’ stockings is a deal pending between the Obama administration and Congress that would give current taxpayers another gift in the form of an extension of all Bush tax cuts and a temporary cut to our Social Security payroll tax, among other tax cuts — costing more than
$800 billion over two years, all of it deficit-financed.
Being an optimist, I remain hopeful for the new year. The president’s fiscal commission garnered support for its recommendations from a majority of its members, which skeptics never believed could happen.
Further, across many of the various commissions, much common ground was achieved — e.g., significant spending cuts to defense and other discretionary spending, reform of our tax code, and adjustments to major entitlement programs.
Therefore, as we gather with friends and family, let’s not only enjoy the spirit of the season but also make a new year’s resolution to pay for our holiday gift-giving and pay down the debt on our national credit card for a better and more prosperous tomorrow.
Sara Imhof, of Coralville, is Midwest regional director for The Concord Coalition,
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