Debt

September 15, 2016

Hello everybody out there in farm country. This radio commentary is brought to you by John Deere and the National Corn Growers Association. They are all friends, supporters, andallies of a healthy farm economy and prosperous rural America. Thank you.

And now for today’s commentary—

Elections are coming up in November – candidates for President, Senate, House, and offices in states and cities are telling us that they will revive the economy, provide security, on and on. What you don’t hear is how they will balance their budgets and bring down the debt.

The federal government is looking at a staggering national debt of 20 trillion dollars. As we wrap up our fiscal year this month, we will add an additional 590 billion dollars to our debt burden.

Federal government revenue this year will post a 1% increase but federal spending will spike up 5%. With an aging population, Social Security and Medicare will continue to rise. Politicians argue for more money to be spent on the military. The Congressional Budget Office tells us that our economy will grow very slowly over the next decade – probably about 2% per year.

Now, using simple arithmetic, if the economy grows at 2% and spending grows at 5%, we are in trouble. We are projected to add 9 trillion dollars of additional debt over the next 10 years.

It is time for politicians to put this shocking threat on the table. It has been ignored – not just on the national level but in states and cities also. Look at my home state of Illinois. We are all but broke. Look what happened to Detroit – bankrupt. Puerto Rico – bankrupt. Don’t ignore Greece. How about Venezuela?

We don’t have to go down this road. It’s not too late, but changing course will not be easy. Here is why. Balancing the budget is simple – raise more tax money or cut spending. But, politicians want to get reelected. And, you don’t get the votes if you take away money or services. You don’t get the votes if you raise taxes. It’s democracy at work. 

So, what to do? It will require a lot of courage. Perhaps term limits would help to reduce the worry about reelection.

At any rate, I hope our leaders will stand up and face the problem. Businesses, farmers, and families cannot borrow their way into prosperity and neither can government.

If you would like to review my radio shows going back more than 20 years, just go on-line to www.johnblockreports.com. Have a great weekend.

Until next week, I am John Block from Washington, D.C.