I get frustrated watching today’s Congress bicker over budget balancing proposals, while our country continues to rack up debt that will burden our children and grandchildren. Nobody wants to acknowledge the obvious; we can’t solve our budget problems overnight. Instead of eliminating the national debt in one year, we need a long-term plan that will allow us to get back on the road to fiscal responsibility, and it starts right now.Here’s a simple three-step approach that will eliminate the national deficit and the national debt, without making brutal cuts to things such as military spending, Social Security or Medicare.
Step #1: Stop the bleeding
I was at lunch the other day with a longtime friend. He’d been out of work for a while, but had just gotten a new job and was starting to get back on his feet. Over lunch he confided in me that he survived his months of unemployment by racking up huge credit card debt. Yet, when the bill came for lunch, he tried to pay with his card.Of course, I picked up the tab, but I asked him if he had a plan for paying off his debt. He chuckled and said, “Sure, I play the lottery on a regular basis.”That’s not a plan!Unfortunately, that’s what it feels like our representatives in Congress are doing with their budget-balancing proposals. They’re looking for a “silver bullet” instead of coming up with a reasonable plan.Just like paying off personal credit card debt, the first thing we need to do is stop the bleeding—stop racking up more bills on credit, and eliminate our annual deficit.In the current fiscal year (2012-2013) the United States will spend more than $1.3 trillion more than we bring in from tax revenue. The only way to make progress toward paying down the national debt of $15.7 trillion is to first get our arms around the annual deficit.
Step #2: All-of-the-above strategy
Republicans say, “We have a spending problem, not a revenue problem.” Democrats say, “We need a fair tax code so everyone pays their fair share.” The truth is, they’re both right. We must eliminate wasteful spending, AND we must come up with a fair tax structure.When I was an officer in the United States Navy, I was taught that, “You get what you inspect, not what you expect.” We need a top-to-bottom review of federal spending to assess the effectiveness of every dollar spent. Just like the Navy's Preventative Maintenance System, we need a method by which programs can be graded based on objective criteria measuring the effectiveness of the program. This will allow us to grade government programs that are spending our tax dollars. Where a program is not making the grade, it should be eliminated.Similarly, we need a tax code that works for us, not the other way around. We need to stop giving tax breaks to corporations that send American jobs to other countries. Equally important, we need to reinvest American tax dollars in America, not in foreign countries.These concepts seem almost too simple, but they’re not. By aligning our priorities in the right way, we can eliminate the national deficit and start to pay down the national debt.
Step #3: Long-term planning
The days of budgeting year-to-year must end. Any successful businessperson will tell you that planning for the future is necessary to run a profitable business. We need a long-range strategic plan for our country’s economy. Just like any good business, we must constantly be looking over the horizon for new possibilities and opportunities to keep us on the cutting edge of the global economy.As we work to pay down the national debt, we must likewise think in terms of long-term solutions. That's the approach I took in Colorado to address the shortfall in its public employee pension system.Following the stock market crash of 2008, Colorado’s public employee pension system (Public Employee Retirement Association, “PERA”) took a $10 billon hit. With annual state tax revenues of about $7.5 billion per year, it was clear that PERA was in big trouble.The Colorado legislature endeavored to address this problem in 2010. Instead of trying to come up with a “silver bullet” to erase the problem in a single year, the PERA deficit was amortized over a 30-year period, and an annual payment plan was devised to allow Colorado to eliminate the shortfall over time. Ultimately, the pension plan was saved by this action, and it was the first step toward economic stability and recovery in our beautiful state.The same approach can be taken in paying down the national debt. Our current $15.7 trillion national debt will not be eliminated in one fell swoop. However, if we amortize it out over time, then dedicate ourselves to making the annual payment each year (prioritize it first, and make this payment before, we spend anything else out of our nation’s annual budget) we can eliminate the national debt.This will have enormous positive ramifications for our economy. Businesses crave stability and predictability. One of the most detrimental forces acting on our economy today is the lack of certainty for future investments. The size of our national debt contributes directly to this instability. When lenders don’t lend money because of high volatility in the markets, businesses don’t have the capital to build, hire, manufacture, invest, research, develop, train, expand, grow, etc., etc., etc.The key to injecting fuel into our lagging economy is creating stability and predictability. We do that by devising a plan for balancing our country’s budget and eliminating our national debt.
Conclusion
Getting our arms around the federal deficit and national debt will not be easy. The numbers are enormous, and it’s not something that can be tackled overnight. However, we must get our federal budget under control to get our economy back on track. I believe good governance relies on practical solutions, not ideology. We have a sincere desire to balance our nation’s budget, so let’s stop playing politics and eliminate our national debt to get America back on the right track.
Brandon Shaffer is the current president of the Colorado State Senate and is running for Congress in the Fourth Congressional District against Cory Gardner. The Fourth Congressional District incorporates Douglas County, Longmont, Weld County and the Eastern plains from Holyoke all the way down to Trinidad.