The U.S. Deficit: Can We Have Our Cake—and Eat It Too?

Most Americans are concerned about the rapidly growing debt the U.S. owes. But who is willing to make the kinds of cuts that would be necessary to fix our budget problems?

How would your family fare? Imagine: You take in a total of $43,000 per year and spend $75,000 per year. The rest? Just put it on the tab; use credit cards, a line of credit on the family home or unsecured loans from the bank.

Does this sound disquieting? Most of us wouldn’t wish to live this way, spending over 50 percent more than we take in.

The fact is, most of us couldn’t live this way very long. Our creditors would soon cut off our credit and call in our loans.

Yet this is a good comparison of current federal spending in the United States. According to the 2011 Budget Chart Book, the projected level of federal spending for 2011 was to be $3.77 trillion, while projected revenues were expected to come in at $2.15 trillion. That’s a shortfall of $1.62 trillion for this year alone!

The Congressional Budget Office (CBO) projects a federal budget deficit of close to $1.5 trillion, or 9.8 percent of GDP for 2011, all other factors remaining equal. In dollar terms, this is one of the highest on record. Though it doesn’t compare with much higher percentage deficits from the 1940s, since the dollar amounts are so large, they are adding to the national debt at a daunting pace.

Mind-boggling numbers

How much is the total national debt? It’s estimated at over $14 trillion dollars, or roughly $46,000 for each and every U.S. citizen.

Mind-boggling as these numbers may be, it seems the message is getting through. According to a recent Gallup poll, 71 percent of Americans say they worry about the economy “a great deal,” and 64 percent worry a great deal about federal spending and the budget deficit.

Solutions or political suicide?

But what to do about it? With entitlement programs constituting some 60 percent of federal outlays, there have been recent attempts to rein in some of that spending.

Recently Republican congressman Paul Ryan proposed a voucher scheme to replace the current Medicare entitlement system—only to see fellow GOP member Jane Corwin soundly beaten in her attempt to hold her hitherto-safely-Republican congressional district. The reason? “Mediscare.” She was accused of wanting to dismantle the costly entitlement program.

You can’t have your cake and eat it too, or so the old saying goes. Americans are concerned about the deficit but unclear about what to do to fix it. A Washington Post-ABC News poll conducted in April revealed that 78 percent of those polled opposed cutting spending on Medicare, 69 percent opposed cutting Medicaid spending and 56 percent opposed cutting military spending.

In fact, the only budget-fixing measure that garnered majority support in this poll was 72 percent for raising taxes on incomes of over $250,000—a measure that, by itself, would be woefully inadequate to solve the budget dilemma.

Where are we headed?

So where are we headed? Former President Bill Clinton recently characterized the partisan confrontation over the deficit now taking place in Washington as a battle of “political theology.” And when it comes to theology, the faithful aren’t inclined to compromise. In this case, one party wants to preserve the programs, while the other rejects tax increases as a solution. And the result is economic peril, perhaps even disaster.

The Word of God tells us that “the borrower is servant to the lender” (Proverbs 22:7). Are we set to bequeath to our children a national debt tab so huge as to doom them to financial servitude? If the gridlock can’t be broken and a real solution enacted, that may be exactly what will take place.

For more background on these issues, see these recent blog posts: “With All These Taxes, Why Is the U.S. Getting Deeper in Debt?” and “Bin Laden Is Dead (But His Goal Lives On).”

Ralph Levy is a minister of the Church of God, a Worldwide Association, living in Ohio.