My Plan to Beat the National Debt
By Senator Rand Paul
I have often said that our federal government doesn't have a revenue problem, it has a spending problem. This is undoubtedly true. But merely trying to address our exorbitant spending brings up another, almost worse problem-finding the political will in Washington to address the problem.
Virtually everyone now claims to be for some sort of spending cuts in the name of balancing the budget, yet most politicians only tend to support such measures in the abstract. When you get down to specifics that's where so many of them-even most Republicans-abandon ship.
We cannot afford to do this, quite literally. And in their ongoing refusal to address our spending problems seriously and substantively, Washington politicians must be reminded that they are also abandoning the American people.
There is no excuse for this. Recently, both parties in the Senate discussed and debated two different alternatives about what we should do regarding the budget deficit. Per their usual, both alternatives were inadequate and do not significantly alter or change our course.
On the Democrat side, we had a proposal to cut about $5 billion to $6 billion for the rest of the year. To put the utter ineffectiveness of this proposal in perspective, the federal government borrows about $4 billion a day. So the Democrats proposed spending cuts equaled only one day's borrowing. Obviously this is insignificant and it will not alter the coming and looming debt crisis that we face.
Then there was the Republican proposal. Our proposal to cut $57 billion was more significant than the Democrats, but like the other party it still paled in comparison to the problem. If we were to adopt budget approach of the Democrats we would have $1.65 trillion deficit in one year. If we were to adopt the Republicans approach, we would have a $1.55 trillion deficit in one year. Neither one of these proposals would significantly alter or delay the crisis that's coming.
Part of the problem is that no one is really talking about cutting spending. What both parties have proposed is simply cutting the rate of increase of spending. The base line of spending is going to go up 7.3 % according to the Congressional Budget Office and we're talking about reducing that to only a 6.7% increase. We're talking about cutting the rate of increase of government. Once again, across the board and across the aisle, the problem with what both parties are proposing is that it's not enough.
Our deficit is growing astronomically and our national debt is now $14 trillion. That debt is now equal to our entire economy and our gross domestic product equals our national debt.
The president is tone deaf on this. President Obama recently proposed a 10-year budget featuring a 10-year plan for spending. He proposes that we spend $46 trillion. Spending $46 trillion? Washington officials clearly do not understand how profound our problems are. The president's plan will add $13 trillion to the debt and the Republicans say "oh, well ours is a lot better"-but their plan will add $12 trillion to the debt.
This is unacceptable.
In order to get serious reform, we have to come to grips with the idea of what government should be doing: What are the constitutional functions of government? What are the enumerated powers of the Constitution? What powers did the Constitution give to the federal government? We should ask these questions and then examine what we're actually doing today. What are we spending money on that is not constitutional, that perhaps shouldn't be done at the federal level or should be left to the states and the people respectively?
Once upon a time, Republicans believed that education was a function of the states and the localities. It's not mentioned in the Constitution that the federal government should have anything to do with education. Does that mean we're opposed to education? No, we just think it should be managed closer to home.
Ronald Reagan was a champion of eliminating the Department of Education. It was part of the Republican Party platform for twenty years. But when Republicans were in charge under President George W. Bush we doubled the size of the Department of Education. If you are serious about balancing the budget, if you are serious about the debt, you have to look at taking departments like the Department of Education and sending it back to the states and the localities.
You have to look at programs that have grown astronomically like Medicaid and food stamps, cap them, block-grant them and send them back to the states. The states can manage these things better-which the Founders both understood and intended. The closer such functions are to the people, the better managed they will be.
The other compromise that needs to occur-and this is something that Republicans must learn to compromise on-is military spending. Our side has blindly said that the military should get anything it wants, eternally giving the Pentagon blank checks.
But we have increased military spending by 120% since 2001, more than doubling it. Like all Americans, I support a strong national defense and of course it is a constitutional function of the federal government to provide for our national defense. I think it is the pre-eminent power, the pre-eminent enumerated power, the thing we should be doing here.
But with that said, we cannot double the Defense Department and military spending every eight years. This is a compromise Republicans must learn to accept if we ever expect to substantively tackle our spending, deficit and debt.
We also must look at entitlements. Everyone's afraid to say how we reform entitlements, but there are two inescapable facts on this issue: We're living longer, and many of those born after World War II are getting ready to retire. These are inescapable demographic facts and we have to address them. If we simply do nothing and do not address the entitlements, within a decade, entitlements will account for the entire budget and interest. There will literally be no money left for anything.
It's going to take both parties grappling with this and admitting that the rules and eligibility will have to change for Social Security, and likely for Medicare. If we do it now, we can do it gradually. If we start now, we can gradually let the age rise for Medicare and Social Security for those 55 and under. If we do it now, young people will be able to acknowledge that this is going to happen in the future.
You ask young people anywhere across America, "Do you think you're going to have Social Security when you retire? Do you think you're going to get it at 67?" Young Americans acknowledge that the system is broken and broken so badly that the only way we fix it and the only way it can continue is we have to look at the eligibility.
But many in Washington say we can't talk about entitlements. The president still makes this mistake. He will not lead on entitlement reform or anything else concerning our fiscal crisis. But someone must do it. We must stand up and be bold because the longer these problems fester, the longer we allow them to accumulate, the bigger the problems become. Likewise, the more dramatic the answers must be.
I have proposed a five-year balanced budget plan that would bring spending near the historical average in its first year, would repeal Obamacare, and reduce spending by nearly $4 trillion relative to the President's budget. Many have criticized Republicans for not giving specific budget cuts and this criticism is often warranted because too often Republicans are afraid to be specific. Here are the specifics of what my five-year balanced budget plan will accomplish and how:
- Brings spending near historical average in very first year
- Reduces spending by nearly $4 trillion relative to the President's budget
- Achieves a $19 billion surplus in FY2016
- Brings all non-military discretionary spending back to FY2008 levels
- Requires the process of entitlement reform, including Social Security and Medicare, with final implementation by FY2016
- Does not change Social Security or Medicare benefits
- Block-grants Medicaid, SCHIP, foods stamps, and child nutrition
- Provides the President's request for war funding
- Reduces military spending 6 percent in FY2012
- Eliminates four departments:
- Department of Commerce (transfers certain programs)
- Department of Education (preserves Pell grants)
- Department of Housing and Urban Development
- Department of Energy (transfers nuclear research and weapons to Department of Defense)
- Repeals Obamacare
- Never exceeds $12 trillion in debt held by public
- Creates $2.6 trillion less in deficit spending relative to the President's Budget
- Extends all the 2001 and 2003 tax relief
- Permanently patches the Alternative minimum tax
- Repeals Obamacare taxes
I have been joined in this plan by Senators Jim DeMint of South Carolina and Mike Lee of Utah. I now ask "Where is the rest of the Republican Party?" While official Washington is sitting on their hands and ignoring the ever-expanding deficit, I am offering a real plan to rein in spending and address the looming debt crisis. The only way we can balance the budget is if we have real leadership.
So many Republicans love to call themselves "Tea Partiers" these days. My five-year balanced budget plan gives them a chance to prove it.
Rand Paul is the junior United States Senator from Kentucky and the son of Texas congressman and 2008 presidential candidate Ron Paul.