Deficit Reduction

Deficit Reduction

The non-partisan Congressional Budget Office estimates that net interest on the debt will soon rise to 14% of the total federal budget. That’s just one percentage less than the entire projected defense budget. This level of debt is unsustainable and is putting our entire nation at risk.

Short-term political decisions over the past few decades have created unsustainable budget obligations that politicians have been unwilling to address. Band-aid solutions like President Obama’s over a 10-year period, won’t work. We need real solutions.

Discretionary spending (including Defense) makes up 40% of the federal budget. We must make cuts to this spending, e.g., reducing budgets for non-core agencies, tightening defense procurement processes, reducing headcount across agencies, etc. However, cuts to discretionary spending will only take us so far.

60% of the budget is comprised of mandatory entitlement programs (Medicare, Medicaid, Social Security) and interest payments on the federal debt. This means that cuts in discretionary spending alone will not come close to eliminating the deficit.

Sustainable deficit reduction can only occur through entitlement reform. Means-based testing, increased age of first benefit, and other reforms will be necessary. These changes will be difficult and will require our legislators to put America’s future ahead of their own careers. Real reform will be politically difficult, but the costs of inaction will be devastating.

It’s time for political courage in Washington.