Unsustainable Debt

By Congressman Tom Cole

Earlier this month, the U.S. national debt alarmingly surpassed $30 trillion, which means it effectively doubled in just a decade. While there is no easy or immediate solution for tackling the problem of our massive debt, the monstrous size of and rate at which it continues to grow should concern us all and spur on congressional leaders and the president to responsibly address it.

For context, it is helpful to understand how federal government spending works. It falls into a couple general categories that operate differently: discretionary and mandatory. During the annual budget and appropriations process, lawmakers address only the discretionary side of the budget. This includes funding for our national defense, transportation and infrastructure, education and much more. Mandatory spending, on the other hand, is essentially on automatic pilot unless Congress enacts legislation to reform or constrain it. This category includes programs like Social Security, Medicare, Medicaid and some additional social safety net programs, which automatically pay out benefits to those eligible and enrolled. While Congress has cut annual discretionary funding at different points in time, those cuts cannot keep up with rate at which mandatory spending is growing.

Indeed, the mandatory side of the budget is by far the largest category of spending. For years, economic analyses, studies and projections have warned about its unsustainable growth. For example, the Congressional Budget Office (CBO) reported that mandatory programs represented 34 percent of all government spending in 1965. Today, that figure has risen dramatically to reflect more than two-thirds of all spending. Meanwhile, an added concern is the simultaneous growth of interest on the national debt and rising interest rates, further impeding the nation’s ability to pay for various programs and services in the future.

With mandatory, it is not only the rapid rate of its growth, eclipsing discretionary, that is alarming. CBO has also projected that the federal trust funds connected to Medicare and Social Security are quickly nearing insolvency and thus will eventually fail to deliver on the benefits promised. According to the Social Security and Medicare Boards of Trustees 2021 Annual Report, absent policy changes, Social Security’s combined trust funds will be exhausted in 2034.

Although critical reforms to mandatory programs are needed, that does not negate the importance of preserving them. Indeed, all Americans have paid into these programs throughout their working lives. However, without changes that modernize the current system, Social Security simply will not be able to pay out full benefits to future generations.

To encourage needed reforms to save Social Security before it is too late, I recently reintroduced the Bipartisan Social Security Commission Act – legislation that I have sponsored for the last five consecutive Congresses. If enacted, the bill would lead to the formation of a bipartisan and bicameral commission tasked with recommending reforms to ensure Social Security is solvent for at least 75 years. Congress would then be required to vote up or down on the commission’s recommendations within 60 legislative days.

The legislation is modeled after the successful approach taken by former House Speaker Tip O’Neill and supported by President Ronald Reagan in 1983, when Social Security was also on the brink of bankruptcy. At that time, bipartisan legislation was approved to stabilize and improve the fiscal foundation of Social Security. And the resulting legislation not only received widespread public support, it extended the life of Social Security. As a hopeful historian, I believe what worked before to save Social Security can work again—if both parties commit to pursuing reforms in a thoughtful, fair and bipartisan manner.

Although our national debt is rising at such a concerning pace largely due to mandatory spending, that does not mean that the discretionary side of the budget has always been managed responsibly, including with emergency funding bills. To be clear, the public health emergency and associated pandemic response led to congressional approval of trillions of supplemental dollars in relief supporting various aspects of our society. While five of those bills were bipartisan and needed efforts that I supported, I regret that President Biden has repeatedly called for trillions more in spending that has nothing to do with pandemic recovery and everything to do with changing the very fabric of American society – and not for the better.

Continuing to spend on the national credit card and failing to enact deficit-reduction policies to pay it down is not only irresponsible, but absolutely unsustainable. During a time when our nation faces mounting threats such as an increasingly adversarial Communist China and the highest inflation seen in 40 years, the monstrous size of our national debt quite simply poses great risk to our national security. Indeed, unless government leaders get serious about addressing the biggest drivers of that debt and until Democrats abandon their irresponsible multi-trillion-dollar policies, the country will continue drifting even faster toward a catastrophic economic disaster.