Treasury Secretary Jack Lew called concerns over federal debt a "false crisis." Surging spending has driven the massive buildup of debt under President Obama. Total federal debt today is $17 trillion, twice as high as when Obama began. Federal spending soared from about 20% of GDP when Obama took office to 25% of GDP the following year.
Posted 07/29/2013 06:49 PM ET
Budget: Treasury Secretary Jack Lew calls concerns over federal debt a "false crisis." Like someone falling out of an airplane who refuses to realize he'll soon hit the ground, Lew is deluding himself — and us.
The Democratic Party and their allies on the progressive left, including a number of notable economists who should know better, can't bring themselves to admit the hard reality — their big-spending, debt-increasing policies have wrecked the world's greatest economy and things, if left unchecked, will get worse. Much worse.
And yet, here's Lew on "This Week with George Stephanopoulos," speaking on current budget talks: "We need to remember this isn't just about cutting budgets."
No, given our situation, that's exactly what it's about.
Surging spending has driven the massive buildup of debt under President Obama. Total federal debt today is $17 trillion, twice as high as when Obama began.
Lew and others would have you believe it's Republicans' fault for refusing to spend enough to revive the economy — a common refrain among Democrats.
But federal spending soared from about 20% of GDP when Obama entered office to over 25% — an all-time record — the following year. Today at 23% it's still way above the norm of around 18% to 20%. And it would go even higher, if Obama had his way.
This is the real reason for our massive trillion-dollar deficits and ever-increasing debt — not "Republican policies." And it's not a "false" crisis, but a very real one.
What's most alarming is that under current Democratic policies, federal debt will grow 50% from $17 trillion this year to over $25 trillion by 2023 — and that's using the most conservative financial estimates.
That will place our national debt at 100% of GDP or higher for decades to come — a level, most sane economists agree, is unsustainable.
A study by University of California economist James Hamilton puts the total U.S. debt — existing debt plus future liabilities — at $70 trillion, up $8.7 trillion in just two years. We're going broke, fast.
For Lew to call this a "false crisis" shows an obliviousness to the real dangers posed by surging debt.
In his remarks, Lew also encouraged Congress to replace indiscriminate sequester cuts with "more sensible policies." Likewise, President Obama accused Republicans of wielding a "meat cleaver."
In fact, the sequester cuts are tiny, and over time barely touch spending. The Congressional Budget Office projects a spending rise of 69% by 2023 without the sequester. With the sequester? Spending rises 67%.
In short, these are not "cuts" at all, merely a minuscule reduction in a massive tidal wave of spending.
Today, 130 million people get a government check of some kind, food stamp dependency is at record highs, unemployment remains stuck above 7%, and neither Social Security nor Medicare is actuarially sound.
"False" crisis? No, it's called reality, frightful reality.
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