Even President Barack Obama appears to realize that Washington has a spending problem. His latest budget, delivered late and without enthusiasm, makes a nod toward restraining the growth of social programs, most notably “entitlements,” headed by Social Security, Medicare, and Medicaid. Alas, that baby step earned a rebuke from his left-wing allies, along with a threat by Rep. Greg Walden, who heads the House Republican campaign committee, to block the President’s “shocking attack on seniors.”
In fact, much more needs to be done to save Washington from bankruptcy.
Uncle Sam faces two fiscal crises. The first is short-term. After running more than $5 trillion in deficits over the past four years, Washington is expected to add “only” $845 billion in red ink this year.
Before Americans break out the champagne, however, they should read the latest analysis from the Congressional Budget Office. “[I]f the laws that govern taxes and spending do not change,” explained the CBO, “federal debt held by the public will reach 76 percent of GDP by the end of this fiscal year, the largest percentage since 1950.” Back then, Americans were beginning to pay down the debt accumulated during the Great Depression and World War II.
Things get a bit better through 2015. Reported the...