A detour for our national budget

Our country is facing a number of big problems but the most urgent one concerns the limit on how much the federal government can borrow to pay its bills. It seems like the people in charge of handling these things are not doing a very good job of solving this problem. It's two problems, really. The immediate problem is the limit on borrowing (which we will reach in about a week on August 2) and the other problem is the growing national debt that is triggering the problem with the debt limit. If we weren't needing to borrow so much money to cover expenses, we wouldn't need to worry about the debt limit.

What is making this problem even worse is that it is not just the Republicans and the Democrats who are having trouble agreeing on what to do. A sizable number of Tea Party members of the Republican party are even disagreeing with members of their own party about what to do about these problem. The Republicans have said they will not work on increasing the debt limit unless a budget can be worked out where large spending cuts are made and taxes are not raised. The Democrats have said the budget must include tax increases (or at least, the removal of tax decreases that were put into place years ago) as well as budget cuts. It seems to make sense that people would want to tie action on the debt limit to fixing the budget problems because, if they don't, we will just need to borrow more money and raise the debt limit again later. But these huge budget deficits have been going on (with a small break in the late 1990's) since Ronald Reagan was president in the 80's. Why the urgency now? Why flirt with economic chaos by allowing us to reach the debt limit just to force a deal on the budget? The Republicans answer that it is because the budget deficit is growing much faster now since Barack Obama has increased spending so much to stimulate our economy to get out of the recession that started four years ago. They blame this stimulus for the huge problems we face with the national debt.

Well, while that seems to make sense, it is wrong. Here is a link to a story in The Washington Post about what has really caused the deficit (and the accumulated deficit or The National Debt) we face. It is NOT caused by the stimulus and it is NOT simply a result of recent spending although those things have contributed to it. To be fair, both sides are partly to blame for this misunderstanding. The Republicans are wrong in claiming that they have the right to demand severe budget cuts because it is the President's spending that is causing the problem. But the Democrats and President Obama are also at fault for not getting the facts out for everyone to see. They were also wrong to go along with extending tax breaks enacted in the early 2000's that have made the deficit balloon. Again, if the Democrats had gotten the word out for the need to reestablish taxes on the wealthiest Americans, we wouldn't be in as bad shape as we are in.

For another interesting article about how both sides are failing in the debate about how to handle the debt problem, see this GlobalPost article, The Negotiator: Solving the US debt problem.