“When you find yourself in a deep hole, the first thing you do is stop digging.” That simple truth should be ringing through the halls of Washington right now. DC, we are in a deep hole, and it is long past time to stop digging.
Many informed citizens and our local representatives realize our country is in a debt hole, but very few of them understand how deep it is or the urgency to stop digging now before it is too late. There are many more, perhaps even a majority, who are not fully informed and do not even realize we are in a hole at all. That disconnect between awareness and action is at the heart of our fiscal crisis and helps explain why the problem continues to worsen despite growing attention.
Our enormous national debt is the symptom, not the disease, and the cure is sound economic policy rooted in discipline and restraint.
The scholars are preaching to the choir, and the choir is not singing to the congregation. Until we reach enough of the congregation, the voting public, to understand the problem, grasp the urgency to fix it, and demand change, we will not get Washington to stop digging. Public awareness must translate into public pressure, or nothing meaningful will happen.
Consider the scale of what we are facing. Our federal debt is now $39 trillion, which amounts to over $400,000 for every family in this country. In ten years, under current policy, it will be at least $63 trillion, and that assumes no new spending programs and that everything goes right, which it will not. The trajectory is clear and it is alarming. We are on a road never traveled, and it is a short road. When it ends, we will fall off a fiscal cliff and face a full-blown fiscal crisis, the kind that occurs when investors lose confidence in our government and stop buying our debt. At that point, we will be unable to meet all of our obligations.
The consequences of such a failure would be catastrophic for everyone in United States. Our federal government understands we are on an unsustainable path and openly acknowledges it, yet Congress will not act on the problem until the public demands and supports change. The reason is simple and uncomfortable. Addressing this issue will require difficult choices, and elected officials fear the public will not reward them for making those choices. In that respect, they are right, which is precisely why the burden must shift to the voting public to understand the stakes and support meaningful reform.
We are in trouble, and only we the people can send the message to Washington that we want them to cure the disease, not just manage the symptoms. Washington will not act without public support, so we must provide it, or our leaders will continue the current path until they no longer can, and the country faces the consequences of effective bankruptcy.
The cures are not easy, and if they were, they would already have been implemented. Any serious effort to fix our precarious finances will involve trade-offs and some degree of economic pain. However, that pain will be minor compared to the devastation that would follow a fiscal collapse. We must ask ourselves whether we are willing to impose that burden on our children, grandchildren, and future generations. Doing so would be unconscionable and immoral. We inherited a sound country, and we have an obligation to leave a sound country behind. If we remain on our current course, we are failing in that duty.
What must be done begins with acknowledging reality and committing to change. We must reform entitlements in a way that protects current beneficiaries while ensuring long-term sustainability. We must streamline the governing structure as the Founders intended and return to a limited federal government consistent with our Constitution. We must also fix our tax structure so that it is fairer and more equitable, reducing the influence of special interests that diminish revenue and distort economic behavior. These are not radical ideas, but they are necessary ones if we are serious about restoring fiscal health.
Congress is not addressing the problem because it is focused on the next election rather than the next generation. For too long, we have taken the easy way out, slowly mortgaging our future. The reality is that there will soon be nothing left to mortgage. Time is running short, and the window for orderly reform is closing.
We must insist that our leaders confront the fiscal mess now, while there is still time to act responsibly. The first step is also the simplest and most obvious. Stop digging.
Les Rubin is the Founder and President of Main Street Economics.