There can be no debate that Federal spending is out of control and is stealing our children’s and grandchildren’s futures. According to the Congressional Budget Office, Federal debt held by the public (which does not include social security obligations) was 35 percent of GDP in 2000, 62 percent in the second quarter of 2010, and is expected to reach 70 percent in 2011. The CBO estimates this could climb to 200 percent by 2040 if we do not act decisively to prevent it.
The National Commission on Fiscal Responsibility and Reform, established by President Obama, calls upon every citizen to make sacrifices to help reduce the national debt, which is the greatest threat to economic and political stability in the U.S. Admiral Michael Mullen, Chairman of the Joint Chiefs of Staff, declares the nation’s debt the most significant threat to national security.
Most, if not all, politicians profess to want to resolve the fiscal crisis but few are willing to endorse the sacrifices necessary to do so. Generally, Democrats oppose spending cuts and support tax increases on the “wealthy,” while Republicans support spending cuts and oppose tax increases.
The Commission has proposed spending cuts and tax increases designed to reduce the deficit to 2.3 percent of GDP by 2015 and to reduce the Federal debt by $4 trillion by 2020 and to 40% of GDP by 2040. The Commission would also overhaul the tax code and cap government revenue at 21% of GDP.