By Steve Brawner
© 2016 by Steve Brawner Communications, Inc.

You know the story about Nero fiddling while Rome burned? It didn’t actually happen, but it illustrates a point about leaders crazily ignoring a problem.

These days, no illustration is needed. The government’s largest programs, Social Security and Medicare, are not burning up, but their problems are being ignored.

On Wednesday, the Social Security trustees and Medicare trustees each released their annual reports.

Social Security’s trustees wrote that the trust fund that supposedly finances the program – but actually has been raided to pay for other programs and then filled with IOUs – will be empty by 2034. That’s when today’s 49-year-olds (I’m 47) reach the normal retirement age. When that happens, benefits for all recipients, including 85-year-olds, theoretically would be cut 21 percent.

But of course that probably wouldn’t happen. The American people wouldn’t stand for it, and too many seniors vote. If tomorrow’s elected officials play the fiddle as well as today’s do (and they will probably be some of the same people), they’ll transfer money from the rest of the budget to Social Security and add to the national debt. As of June 21, that debt is $19,265,744,770,778.65, or more than $59,000 for every American.

Medicare’s due date is approaching faster. The trustees say the trust fund that pays for hospitals will be depleted by 2028, which is two years sooner than was projected last year. When the assets are depleted, revenues would cover 87 percent of the costs. Today, the program covers 55.3 million people.

All of this is occurring in the context of huge budget challenges. The government will already spend $534 billion more this year than it will collect, according to the Congressional Budget Office. Social Security, Medicare and interest on the debt already comprise 45 percent of the federal budget. Social Security and Medicare are growing, and the CBO says interest costs will rise from 6 percent of the budget this year to 13 percent by 2026.

In other words, if you neither touch Social Security and Medicare nor raise taxes, everything else, including defense, has to be cut quite a bit.

The American democratic experiment has faced bigger challenges than this one: creating a Constitution, ending slavery, reconstructing the union, winning World War II. Social Security and Medicare previously have faced insolvency, but at various times policymakers have figured out ways to push the due dates into the future. Social Security doesn’t require some Einsteinian policy fix – just spend less and/or collect more tax revenues. Medicare is harder because it’s based on paying into a health care system that keeps getting more costly, but it can be done.

Still, solving these problems is difficult because of changing demographics – we’re getting older and living longer – and because Americans now expect expensive government services for which they’re unwilling to pay the full cost. They believe the money can be found elsewhere, and some can be found, but not enough.

So elected officials not only must put down their fiddles, but they must also come down into the city and convince a majority of people to help put out a fire that, for now, is hard to see. All the while, they must overcome the many special interests who want to feed the fire.

Somebody must lead. Unfortunately, that probably won’t happen this election year. Sen. Bernie Sanders has led the Democratic Party, including President Obama and Hillary Clinton, to calling for increasing Social Security benefits. Clinton says she’ll pay for her increases by raising taxes on the wealthy – but remember, she gets a lot of money from wealthy people. The Republican nominee, Donald Trump, says there will be no need for changing the programs because America will be so rich because of his better trade deals and Mexico-built wall.

If it were up to me, we’d raise Social Security’s retirement age, reduce or end benefits for the wealthy, increase payments to older and infirm recipients, and increase the payroll tax. I’m not sure what to do about Medicare. I’d also cut other things and slowly pay back the money we’ve already spent.

But for now, I’ve lost that debate in every direction. Americans don’t want to cut spending, and they don’t want to raise any taxes.

So at this point, I really don’t care which direction we go. Just stop increasing the debt we’re passing on to my kids. They’re going to have enough on their hands taking care of me someday.

Related: Red ink rising.

By Steve Brawner
© 2016 by Steve Brawner Communications, Inc.

Let’s start this column with two words that sound like they might mean the same thing, but don’t.

“Deficit” and “debt” both refer to when the government spends money it does not have. The big difference is that “deficit” refers to a yearly shortfall, whereas “debt” refers to the government’s accumulated shortfalls. “Deficit” is the money the government added to its credit cards just this year. “Debt” is the money that was already there, plus the new deficit. Add it all together, and the national debt now equals $18.96 trillion, or $58,700 for every American man, woman and child.

Another difference is that sometimes the deficit goes down, but the debt almost never does. In fact, the last time the United States government owed less than it did the year before was 1957 under President Eisenhower.

The one-year credit card additions, on the other hand, have been mostly shrinking since 2009, when the red ink hit $1.4 trillion, or more than $4,600 for every American. That was the year the economy was tanking, the banks were being bailed out, and the United States was still very much involved in Iraq and Afghanistan. Fiscal year 2009 started Oct. 1, 2008, when President George W. Bush was still in office. Under President Obama, yearly deficits stayed above $1 trillion each year until 2013, when the deficit dipped to $680 billion. In 2015, it was $439 billion.

As Obama pointed out in his State of the Union address, deficits have been cut by almost three-fourths since their peak. But with that $439 billon deficit, the government in 2015 still added about $1,400 in debt for every American.

Here’s another way to look at those numbers. As illustrated on the Department of the Treasury’s website, www.treasurydirect.gov, the $1.4 trillion in 2009 was equal to all the debt accumulated over the years from 1790 until 1983 – almost two centuries of combined borrowing. The $439 billion the president bragged about was equal to all the debt accumulated from 1790 until 1972.

That’s better. But no, the state of the union is not strong in this area.

Have I depressed you yet? Here’s the kicker. This brief period of falling deficits is now ending, and the yearly red ink will start rising faster again. On January 19, the Congressional Budget Office projected that the 2016 deficit will increase to $544 billion. From there, yearly deficits will keep expanding so that by 2026, a decade from now, we’ll be back to $1.4 trillion, and that’s assuming Congress doesn’t do anything to make the situation worse, that the United States isn’t in the middle of another recession or war, or that interest rates don’t spike. At that point, the deficit will be 4.9 percent of the nation’s gross domestic product, double what it is today.

This is occurring for several reasons. In December, Congress increased spending for defense and other areas while making permanent numerous tax breaks that were “temporary” but routinely extended every year. Meanwhile, the debt is being driven over the long term by Social Security, government health care programs such as Medicare and Medicaid, and interest payments for the money already owed.

People don’t like to read sentences like that last one. Aside from interest payments, those programs are generally very popular because they are seen as benefitting the needy and/or deserving.

But I’m just telling you where the money goes. The government is increasing spending by $2.7 trillion from 2015 to 2026. Ninety percent of that increase is in those areas.

So that’s where we are: The debt is still increasing, and now, so are the deficits. For the foreseeable future, the government will keep going deeper in debt, and it will do so faster and faster.

There are two types of debt that don’t show up on a balance sheet. One is the debt we owe to our ancestors, who sacrificed much and sometimes everything to build a better life for us. We owe it to them to do the same for our children.

The other debt is to those children. We owe them better than this.

Related columns: Tax-cut-and-spend Congress.

By Steve Brawner
© 2015 by Steve Brawner Communications, Inc.

Many Republican members of Congress, including all six members of Arkansas’ congressional delegation, have signed the Americans for Tax Reform’s pledge not to raise taxes, and mostly they stick to it. Many Democrats have signed a pledge not to mess with Social Security. But there’s no group asking members of Congress to pledge to reduce the national debt.

Much as I hate all these pledges, maybe there should be.

This past week, Congress rushed through two legislative packages that will make the national debt bigger. One was a package that permanently extended tax breaks that, in fairness, mostly were being routinely extended temporarily before. We’re now assured of adding $700 billion to the national debt over 10 years, whereas before we at least argued about it every year. All four members of Arkansas’ House delegation voted for the deal, which was consistent with the pledge they have signed.

And that wouldn’t be a problem, if Congress had voted to cut spending elsewhere to offset the tax cuts. Just as you and I ought to cut back on spending if we decide to take a job that pays less, Congress ought to cut spending if it cuts taxes.

Instead, Congress also voted this week for a $1.1 trillion omnibus spending package that increases spending by $50 billion. The 2,000-page bill is full of provisions that range from the important (allowing the U.S. to compete in the oil exporting market) to the mundane ($65 million for salmon restoration). It was negotiated by congressional leaders behind closed doors and then presented to the membership with little time for them to read it and nothing else on the table to avert a government shutdown.

To their credit, Arkansas’ senators, Sen. John Boozman and Sen. Tom Cotton, voted against both packages, which were combined in the Senate into one vote. In the House, Rep. Rick Crawford and Rep. Bruce Westerman get credit for voting against the spending package. Meanwhile, I can’t blame the two House members who voted for that package, Rep. French Hill and Rep. Steve Womack. Time was running out, there was no alternative, and many Republicans want to give new Speaker Paul Ryan, who helped broker the deal, a chance to succeed.

Also, the tax deal isn’t that much of a break from past policy. It mostly extended tax breaks permanently that were being extended temporarily year after year. Now at least we have clarity.

The problem is that once again, members of Congress voted to cut taxes, increase spending, and add to the debt because they don’t have enough motivations to behave differently. People often complain about “tax-and-spend liberals.” The truth is that most members of Congress often are “tax-cut-and-spend Republicans and Democrats.” And that’s why the national debt is creeping toward $19 trillion, or $58,000 for every American.

In signing the combined packages into law Friday, President Obama said, “I think the system worked.”

He’s right. The system worked perfectly. It did exactly what it was designed to do: Cut taxes, increase spending, and make the numbers work because the costs will be borne by future generations who don’t yet vote.

This has been going on for almost all of America’s history. According to the U.S. Treasury’s website, the national debt was $71 million in 1790, and then it dipped to less than $34,000 at the beginning of 1835, and it’s been pretty much rising ever since, until recently, when it exploded under your and my watch. It took about 191 years for it to reach $1 trillion and then needed 20 years to reach $6 trillion. Under the last two presidents, it’s grown another $13 trillion. As of Dec. 16, it was $18,796,279,678,290.28.

Two things can change this dynamic.

One is voluntary. Voters can elect fiscally responsible candidates. In office, those lawmakers must place as high a priority on future generations as they do on cutting taxes and increasing spending today. Would signing a pledge to reduce the debt help? It’s helped elsewhere.

More likely, there must be a mechanism, such as a balanced budget amendment, that makes it easier for elected officials to make responsible choices because, if they don’t, they’re breaking or at least skirting the law.

That way the system would work only when it does right by everyone – those who vote, those who don’t, and those who can’t because they’re too young or not yet born.