Op-Ed: Big Government Debt Mortgages Our Children's Future

Op-Ed

By Congressman Jeb Hensarling and Congressman Paul Ryan

Published by The Washington Examiner on June 21, 2010

Over the course of the past few weeks Americans have been shocked to learn how dangerously mired in debt our nation has become. The U.S. debt rose past $13 trillion this month, about 89 percent of gross domestic product (GDP), and the International Monetary Fund now projects that the U.S. government's debt will surpass GDP in 2012, a mere 18 months from now -- with no plan in place to set our nation's finances on a sustainable course.

As members of the National Commission on Fiscal Responsibility and Reform, we recently heard testimony that when a nation's gross debt reaches 90 percent of GDP the needle is in the red zone and economic growth will begin to slow about one percent per year.

One percent is about a third of our projected growth -- in practical terms this means millions of jobs will not be created and American families will forego billions of dollars in income, leading to a lower standard of living. In addition to the real pain inflicted on families, this creates a vicious cycle of lower government revenues and more borrowing at ever-increasing cost, which will result in what some have termed a "debt super-cycle."

This is exactly what has been happening in Greece and other European countries where instead of economizing in the face of deficits, politicians have chosen to maintain spending on government payrolls and services, which has led to a cycle of rationalizing, hiding and obfuscating the true cost and growth of government and a scramble to borrow at ever-higher interest rates.

Here at home, there has been a concerted effort by the Obama administration and Democrats in Congress to paint our current spending policies as a temporary aberration created by the economic crisis of 2008.

Nothing could be further from the truth. This level of spending is a policy choice made in full knowledge of its damaging effects on the economy and the American way of life.

President Obama made the choice to submit a budget that proposes increasing federal spending to a level approximately 56 percent over the 2010 level at the end of the decade. To accomplish this, the president proposes growing federal spending from its 2010 estimated level of $3.618 trillion -- or $30,875 per household -- to $5.670 trillion in 2020, which is $48,387 per household.

This means the budget deficit will average nearly $1 trillion a year for the next 10 years and, by decade's end, each household's share of publicly held debt will equal $173,185. This tidal wave of debt set to hit in the years ahead -- set to eclipse 300 percent of GDP by 2050 -- will crush the next generation in red ink and likely crash our economy before then.

These unsustainable debt and deficit burdens were not imposed upon us by some outside force. They are created by the choice to grow the federal government and spend at unprecedented levels.

Reflecting on his own coming of age in a time of economic turmoil, President Reagan said, "To be young in my generation was to feel that your future had been mortgaged out from under you, and that's a tragic mistake we must never allow our leaders to make again."

Today, our leaders are again making the tragic choice to mortgage our children's future. But there is an alternative, and in two future installments we will share with you how controlling spending, reforming our social safety net programs and lifting the crushing burden of debt will spur job creation and put us back on a sustainable fiscal and economic path.

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