8 hours ago . 6 min read
We Have A Problem
By Leslie A Rubin
ost informed citizens understand there is a lot of debt and continuing deficits in our country, but do not understand the magnitude of the problem and what lies ahead if we continue to ignore it. I have heard many times, “I don’t worry about it because there is nothing I can do about it”
Wrong! You need to be concerned. Our politicians’ first priority is to get elected. Their second priority is to get re-elected. Most are very smart people who are concerned about our future but will not do anything that they think will alienate their constituents. That is us, and we need to be informed about our situation and support meaningful change if we want the politicians to move in a logical direction. We need to understand the fiscal mess and what is needed to fix it, and then communicate that to our elected representatives.
So, are our problems really bad? You judge. Here is a key fact from the most recent published financial statements prepared by the Department of the Treasury as of September 30, 2022: Our debt and unfunded obligations total $121.8 TRILLION DOLLARS.
Each person (based on 330 million people) owes $369,090. My eyes glaze over; it is too big to comprehend. And $31 trillion of that is interest bearing debt and will go to $50+ trillion in the next 10 years, IF we do not add any programs, according to the Congressional Budget Office. Deficits as far as the eye can see.
Entitlements and non-discretionary spending are over 70% of the budget. Social Security, Medicare, and Medicaid create over a trillion dollars of deficit every year, and that deficit is growing.
Social security has 2.6 workers pulling the wagon for each retiree in the wagon. It used to be 15 in the ‘50s, and many more before that. The fund that was accumulated in the past will be gone in 11 years, at which time the law requires cuts to benefits to keep the program solvent of around 25-28%.
Medicare, Part A (hospitalization, the part paid for by your payroll deductions) has a fund accumulated that will run out in four years, then benefits must be cut by law.
Medicare B and D (medical and drugs) are worse. There is no fund, and they are voluntary for which users pay a fee. However, the fee only covers 26% of the cost. The rest comes from us, the taxpayers, at enormous cost, almost $400 billion per year. Medicaid has no source of revenue other than our taxes. The federal portion of that paid to the states is over $500 billion per year.
So, the federal government borrows enormous sums to pay for all these deficits. If the lender (you and me) asks the question, “How are you going to pay me back?,” what will the government's answer be? There is only one choice, since there is never a surplus (profit), only deficits:“I am going to borrow more money.”
That is called a Ponzi scheme.
I recognize the problem, so what could I do about it? EDUCATION. And that is why I founded Main Street Economics as a public service, nonpartisan, nonprofit organization to explain the problems and solutions to concerned citizens. If we understand the problems and reasonable solutions, we need to express our opinions to our representatives loud and clear.
There is a lot of material on the Main Street Economics website. Please go to MainStreetEconomics.org and look around. We send a weekly“Facts, No Spin”email. They are all posted on the website; sign up to get yours. A must watch is the 2 ½-minute video, The Debt Bomb. Then you will understand the problem. Most importantly, use our Contact Congress link to send a message to your representatives.
EDITOR'S NOTE: Leslie A. Rubin is a property developer who has founded Main Street Economics as a public service, nonpartisan, nonprofit organization to get public support to help solve our country's fiscal problems. He is the author of Why You Should Give a Damn About Economics!, located free on his website, and can be contacted at MainStreetEconomics.org.
T20 TAMPA BAY MAGAZINE | MAY/JUNE 2023
We inherited a country that worked.
We owe it to future generations to leave one that still works.
Don't let this country be destroyed on our watch.
Get the facts.
6 views 0 comments