Another warning on US national debt for our politicians to ignore

In the wake of Donald Trump’s elevation to the highest office in the world, there has been no shortage of pressing, breaking news. But one significant event seems to have slipped passed journalists.

On Jan. 17, 2017, The Government Accounting Office published: “The Nation’s Fiscal Health” GAO-17-237SP.

{mosads}This report seems to have been completely ignored by the entire “mainstream” news media — no references to it in articles, no Sunday morning discussions, not even references to it on the business channels.

As our politicians proclaim the greatness of our government’s financial recovery, this GAO report provides a much more a dire warning.

The Executive Summary begins by stating: “In addition to near term financing decisions, a broader plan is needed to put the government on a more sustainable long-term path.”

Some other menacing highlights include: 

• “…the federal government continues to face an unsustainable long-term fiscal path.”

• “…absent a change in policy, debt would be greater than the size of the U.S. economy. The debt-to- GDP ratio would surpass its historical high of 106 percent within 15 to 25 years and would continue to grow after that point.”

• “…absent any intervention or policy changes, state and local governments are facing, and will continue to face, a gap between receipts and expenditures in the coming years.”

• “The 2016 Financial Report’s long-term fiscal projections, CBO’s long-term projection, and GAO’s long-term simulations all show that federal spending on health care programs and interest on debt held by the public (net interest) are the key drivers of growing spending in the long term…”

These all seem to echo another government report which seems to be lost, as I have been told, in “old history.”

“The Moment of Truth: Report of the National Commission on Fiscal Responsibility and Reform,” more commonly known as the “Simpson-Bowles Commission,” was released in 2010, almost seven years before the GAO’s  “The Nation’s Fiscal Health.”

The Looming Fiscal Crisis section of Simpson Bowles Commission Report opens with: “Our nation is on an unsustainable fiscal path.”

This is almost directly quoted in the GAO report seven years later: “…the federal government continues to face an unsustainable long-term fiscal path.” This section continues to relate:

• “Since the last time our budget was balanced in 2001, the federal debt has increased dramatically, rising from 33 percent of GDP to 62 percent of GDP in 2010.”

• “The Congressional Budget Office (CBO) projects if we continue on our current course, deficits will remain high throughout the rest of this decade and beyond, and debt will spiral ever higher, reaching 90 percent of GDP in 2020.”

• “By 2025 revenue will be able to finance only interest payments, Medicare, Medicaid, and Social Security.”

This section ends with: “If we do not act soon to reassure the markets, the risk of a crisis will increase, and the options available to avert or remedy the crisis will both narrow and become more stringent. … Continued inaction is not a viable option, and not an acceptable course for a responsible government” basically closing seven years earlier in 2010 with the similar warning to that presented in the opening of the GAO report in 2017.

In an interview with Fortune, Admiral Mike Mullen, former Chairman of the Joint Chiefs of Staff, stated his continued belief that the national debt is “the single biggest threat to our national security.”

The U.S. Treasury reports that at the time of the Simpson Bowles Commission, the Nationals Debt was between 12 and 13 trillion dollars and on September 2012, four months after Admiral Mullen’s statement, the U.S. Debt stood at 16 trillion dollars.

According to the National Debt Clock, our national debt has increased over 50 percent since the Simpson Bowles Commission study and 25 percent since Admiral Mullen’s interview to almost 20 trillion dollars.

It appears that over the last seven years our politicians have ignored their own government commission and the warning from the Chairman of the Joint Chiefs of Staff.

It beckons the question: What have been the guiding fiscal principles of the federal government, both congress and the executive branch, both major political parties, over the last seven years?

Can we the people of this country have any faith that our representatives in our government will even bother to read the GAO report let alone heed the warnings to establish fiscal responsibility?

As “the options available to avert or remedy the crisis will both narrow and become more stringent,” should “we the people” expect greater and greater impact on our day to day life as time goes on while our government continues to ignore their own reports?

Instead, “we the people” must demand honest and direct action by our representatives because “Continued inaction is not a viable option, and not an acceptable course for a responsible government.”

John M. DeMaggio is a retired Special Agent in Charge and retired Captain in the U.S. Navy. The above is the opinion of the author and is not meant to reflect the opinion of the U.S. Navy or the U.S. Government.

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