After a $700 billion bailout that was supposed to keep credit flowing to Main Street, but ended up in Detroit and on Wall Street; a $787 billion stimulus package that was supposed to jump-start the economy but left us with record unemployment; and a $410 billion appropriations bill signed by the President in March, it’s little wonder Iowans are fed up with Washington’s appetite for spending their hard-earned tax dollars. In fact, what started out as moderate indigestion is feeling more like toxic shock to many taxpayers across the country.
Consider the facts. The U.S. budget faced a $1.4 trillion shortfall in fiscal 2009. Federal spending soared above 25 percent of our national income while revenues fell below 15 percent. Nonpartisan budget forecasters say the national debt is projected to reach $20 trillion in a decade. This translates into a legacy of unbelievable debt to our children and grandchildren. That debt burden will be in addition to personal living expenses, mortgage payments, college tuition and the proposed health care entitlement being considered in Congress.
To view a chart showing the average annual increase in debt by each president from Reagan to Obama, click here.
Talk about the Grinch who stole Christmas. Big spenders in Washington effectively dumped lumps of coal in the stockings of taxpayers for generations to come. Taxpayers are confronting the largest annual deficits since World War II. And yet, the current political leadership in Washington seems oblivious to the long-term consequences.
The debt’s obvious downside is the burden on taxpayers to repay what is owed, including the interest on the national debt that chews up an increasing share of the federal budget. The big picture shows us the dark side of the addiction to deficit spending. Continuous deficit spending restricts available revenue for other priorities and throttles private investment in the workforce, innovation and technology. In congressional testimony before the Senate Budget Committee, the former director of the nonpartisan Congressional Budget Office cautioned lawmakers about the perils of unbridled federal spending sprees. Financing chronic federal deficits risks higher interest rates and higher inflation; excessive federal borrowing weakens the dollar and international competitiveness.
As a deficit hawk in the U.S. Senate, I’m working to keep a tight-fisted grip on the purse strings in Congress, and I don’t let loose when tax dollars leave the U.S. Treasury. As a taxpayer watchdog, I keep up a congressional crusade against fraud, waste and abuse that demands accountability, oversight and transparency when tax dollars are on the line. It’s why I’ve insisted on ramping up better transparency, management and oversight of bailout dollars flowing out from the U.S. Treasury.
Massive federal spending this year hasn’t turned around the struggling economy or jump-started job creation. Now the President and congressional leaders want to pass health care legislation that would create yet another unsustainable permanent entitlement that would worsen the national debt. I agree with the majority of Iowans who created standing-room-only gatherings at my town meetings this year and asked: When is enough, enough? When Washington recycles your hard-earned tax dollars and pumps them through the economy, it invariably creates winners and losers and takes money out of circulation for household budgets, wage growth, local commerce and small business start-ups. That’s not the best use of greenbacks or limited resources.
It’s time to put the brakes on the federal spending spree. We can start by letting the Troubled Asset Relief Program – or TARP -- rest in peace. The Treasury Secretary has the authority to extend the bailout program through October 2010. I’ve introduced a bill to rescind the program so it expires at year’s end.
Unfortunately, American taxpayers have trillions of reasons to fault reckless government spending. Unless Washington reverses course and gets serious about taming the deficit, taxpayers won’t have much merriment to celebrate for many holidays to come.