A grim warning cry on soaring US debt
President Obama’s self-congratulatory State of the Union message last week made it sound like our nation’s problems are behind us. But on Tuesday the nonpartisan Congressional Budget Office set the record straight with a blistering warning.
The CBO cautioned that America’s unaffordable public programs and crushing debt will condemn us to anemic economic growth.
Total federal debt will reach $22.3 trillion by 2020. Unsustainable, says the CBO — especially when now-low interest rates return to normal.
Don’t count on spendaholics in Congress to take this warning seriously. Sen. Chuck Schumer (D-NY), for example, responded to the CBO by boasting about this year’ s $468 billion federal deficit — the smallest since Obama took office — and smirking at “Republican rhetoric about ‘a big government’ boogeyman.”
Sorry, senator. The CBO predicts you won’t be seeing deficits that small again except in the rear-view mirror. By 2020, the deficit will nearly double, as federal spending reaches a staggering $4.8 trillion.
A four-foot stack of $100 bills totals $1 million. To get to $1 billion, you need seven stacks as high as the Washington monument. To get to $4.8 trillion, you need 33,000 Washington monuments.
Or an increasing number of entitlement programs. The CBO report devotes an entire chapter to the nation’s newest entitlement, ObamaCare, presenting three distressing facts on the programs next five years:
- The cost of subsidies on the exchanges will more than triple, from $32 billion to $106 billion in 2020.
- Over the same period, federal Medicaid costs (also goosed by the ObamaCare law) will double.
- Despite all the spending, 30 million people will still be uninsured. That’s more than the number the law helps.
Worst of all is this new CBO prediction: Some 9 million to 10 million people will lose their employer-provided coverage in the next three years. Some will wind up on Medicaid, others in subsidized exchange plans.
Translation: Millions who now earn their benefits will instead be collecting them as government “assistance.” Hardly progress. One out of every four Americans under 65 will be on health welfare.
Shocked at the prospect of losing your on-the-job coverage? You’ve been Gruberized.
Jonathan Gruber, the MIT economist who called the public “stupid,” also falsely assured audiences that ObamaCare was designed “to leave those who are happy with their employer-sponsored insurance alone.”
The White House made similar statements.
Speaking of deceptions, this week’s CBO report finally puts an end to its own laughable claim that ObamaCare is paid for and repealing it would “add to the deficit.”
That’s what CBO chief Douglas Elmendorf shamelessly told Congress in 2011 and 2012. Democrats used it as ammo against presidential candidate Mitt Romney, who ran on repeal.
Shameless, because back then the CBO should have admitted the health law was rigged to take in revenue for four years before paying for entitlements.
“Deficit reduction” there simply meant taxing first, and not starting to spend until later. But once the outlays begin, the law’s a budget-buster, not a deficit-reducer.
This week’s CBO report shows the staggering cost of ObamaCare over the next 10 years, with no pretense that it’s paid for or solves the problem of the uninsured.
Of course, ObamaCare is only part of the entitlement problem. Medicare is a bigger part — even though spending per Medicare beneficiary is actually declining, despite overall health-care inflation.
Trouble is, enrollment is set to soar as the rest of the Baby Boom turns 65. Short of upping the eligibility age or means-testing — or a yet-undiscovered reform that somehow saves money without compromising care — Medicare spending will continue upward.
Overall, the CBO report is a reality check.
In his State of the Union speech, Obama bragged about bringing down the deficit — as if it were his doing, rather than a temporary result of economic recovery — then launched into a laundry list of spending proposals, including free community college.
As if the nation could afford yet another entitlement.
The CBO report shows that entitlement reform is urgently needed. The best way to start is by not adding new ones.