The federal debt and budget deficit loom as major issues in the November elections. And now comes a report that the nation's fiscal health is much worse than acknowledged.
While the federal government reported a deficit of $1.3 trillion last fiscal year, USA Today insisted last week that the actual number was closer to four times that amount, or $5 trillion. That's because Congress has exempted itself from typical accounting standards that would require the government to include the cost of promised retirement benefits.
Both Republicans and Democrats share the blame. The newspaper recalculated deficits back to 2004 and concluded "no correlation between fluctuations in the deficit and which party ran Congress and the White House."
The numbers are staggering.
"Deficits from 2004 to 2011 would be six times the official total of $5.6 trillion reported," USA Today found. In addition, most families are far more fiscally responsible than the politicians we send to Washington. "Federal debt and retirement commitments equal $561,254 per household," while the average homeowner "owes a combined $116,057 for mortgages, car loans and other debts."
The report should be a rude awakening to those who pooh-pooh concerns over the health of Social Security. In fact, the system is hemorrhaging. According to the newspaper, the program would "need $22.2 trillion today, set aside and earning interest, to cover benefits promised to current workers and retirees beyond what taxes will cover. That's $9.5 trillion more than was needed in 2004."
Jim Horney of the liberal Center on Budget and Policy Priorities told USA Today that all this is no big deal because Congress has no legal obligation to deliver on future retirement promises. That should comfort the under-40 set.
But beyond that, this accounting gimmickry serves only to hide the actual toll that years of financial profligacy inside the beltway have inflicted on the nation. Nor can we just tax "the rich" to make everything better. The numbers don't add up. Instead, if we are truly to make any fiscal progress in the long haul, this country needs to re-evaluate whether it can afford a leviathan federal government that attempts to offer so much to so many.