After spending a delightful weekend birding, gardening, and reading about debt crises in various countries, I decided to check back in with blogs; and what should I find on Ezra' Klein's site but this truly terrifying graph from the GAO:
That expanding blue portion is debt service, and this graph shows it taking up almost all government revenues by 2040. Put another way, this graph shows somewhere around 16% of our entire Gross Domestic Product going to service our national debt. However, things are worse than this graph lets on. It assumes that all of Bush's tax cuts are made permanent, and that no other changes are made to the tax system. This means that it is not assuming a fix to the Alternative Minimum Tax, which most people think will happen, and which will reduce revenues. It also assumes that discretionary spending grows only as much as GDP, which most people think is unrealistic. In addition, if you check out the modeling assumptions, the GAO has assumed that interest rates remain unchanged. As they note, this is unlikely, especially if we rack up debt at this alarming rate. They also assume that productivity growth remains unchanged, which is also unlikely if we keep running massive deficits.
Bush's tax cuts are unsustainable, and they must be repealed. The sooner we do this the better: leaving this task for later means accumulating more debt in the interim, and thus having to raise taxes higher in the future. And this should not be an issue dividing liberals and conservatives: spending something like one seventh of our GDP on debt service is a terrible idea whatever one's political persuasion. Nor will spending cuts alone do the trick, especially if we don't want to cut one of the largest parts of discretionary spending: spending on defense and homeland security. To put the tax cuts in perspective, here's another chart, this one comparing the cost of the tax cuts, once they're fully phased in, to several entire government departments:
As you can see, we could eliminate the entire Department of Housing and Urban Development and the EPA, and still not save enough money to make up for Bush's tax cuts to the top 1% alone.
We are mortgaging our nation's future, and leaving ourselves vulnerable to really serious problems. We should stop. My party worked hard to bring the deficit down, and we put a lot of our goals on hold to do so. Now that the Republicans are in charge, they should do the same. They claim to be patriotic, but I do not see how one shows a love of one's country by bankrupting it.