Someone had blunder’d:
Theirs not to make reply,
Theirs not to reason why,
Theirs but to do and die.
From “The Charge of the Light Brigade”
Take pity on the can. It’s been kicked so far down the road, it could circle the globe a dozen times. It’s been battered more than the New England Patriots’ starting lineup. It’s been kicked harder than an Adam Vinatieri football.
And still it persists.
This week, Congress and President Obama reached a deal that reopens the government through January 15 and suspends the debt ceiling through February 7. Calling it a deal, though, is an exaggeration. One side, the Democrats, refused to negotiate. The other side, the Republicans, asked for something it had no hope of getting. So everyone agreed to kick the can three months down the road.
Beyond that, according to The Wall Street Journal, “The bill includes one minor change to the health law sought by Republicans, setting new procedures to verify the incomes of some people receiving government subsidies for health-insurance costs. It also provides back pay for all federal workers who were furloughed during the government shutdown.”
If you were losing sleep wondering whether government workers would be paid for doing nothing for a couple of weeks, this is good news. Otherwise, it’s a non-event.
As for setting procedures for income verification for health insurance subsidies, you may be shocked that had to be negotiated. Obamacare was set up so that income verification was not required during the first year for those seeking government subsidies. Under the new agreement, Warren Buffet may not be able to seek free health insurance from the Nebraska healthcare exchange.
The net result of the budget deal is that we can expect a replay of the debt ceiling tragicomedy three months from now.
Going Broke
No one is expecting that by February 7, Congress will reach an agreement that will help control our rising debt. Republicans will continue to be divided. Democrats will continue to refuse to negotiate, blame Republicans and see their approval rating rise … or at least not drop as much as those of Republicans.
So the can will likely be kicked again. But what happens when the can can’t?
The can that’s being kicked is America’s future. It is the hopes and dreams of entrepreneurs whose ideas today could become tomorrow’s Apples and IBMs. It is the personal freedom that comes with economic freedom. It is our children’s legacy.
The can is now nearly $17 trillion in debt. Add on $86.8 trillion in unfunded liabilities. And it’s only getting worse. Interest payments on the debt for fiscal year 2013 came to $415,688,781,248.40, according to the U.S. Treasury. As interest rates rise, so will payments on the debt.
And yet spending is also increasing at an unprecedented rate. In 1981, federal debt equaled about 32.5% of gross domestic product (GDP). As recently as 2008, it was at about 60% of GDP. It now exceeds 100% of GDP.
Unless action is taken today, America’s credit rating will be at risk, Medicare will go broke, Medicaid will go broke, the Social Security system will go broke and the U.S. will owe trillions of dollars to a Communist country. But why take action now when you can kick the can once again?
In four years, we’ll have a new President. Next year, we’ll elect new members of Congress. It will be their problem. They will find out how good they are at kicking the can. They will keep kicking the can, but, inevitably, they will find that the can can’t be kicked any farth