America's Fiscal High Noon
Rather, as Republican and Democratic legislators alike ponder the debt ceiling vote, hurtling down the road at a dizzying pace, it’s critical that they admit and confront the reality that, unless we sober up vis-à-vis deficit spending, the party is over.
Fortunately, the impending debt ceiling is the perfect bucket of cold water to sober us up and fast. Treasury Secretary Timothy Geithner estimates the U.S. Treasury will run out of money by May 16 -- emergency interim steps allowing America to stay solvent until about July 16. After that it’s a new credit card or bust.
The debt ceiling vote is the only leverage Americans have to demand a serious, come-to-Jesus moment of fiscal sanity regarding the imperative to scrub the $1.6 trillion deficit for FY 2011.
To give an idea of how large that deficit is, every American household would need to pony up $15,000 to pay it off.
That’s a lot of lemonade stands.
Of course, there’s a better way. America has had a tsunami of red ink and, just like in other disasters where Americans step up to the plate and pitch in, now should be no different.
So why not ask key players to tighten their belts for one year, e.g., emergency across-the-board federal spending reductions and a one-time emergency tax levy on America’s richest corporations and individuals. In exchange, the government would lower tax rates on corporations and individuals to growth-inducing levels starting in FY ’12 -- to spur not class warfare but a humming "Morning in America" economy, which is the best safeguard against class animosity.
To find the remaining money, now would be the time to defund -- for real -- budget-busting ObamaCare. In its place, put the Patients’ Choice Act, introduced in the 110th Congress -- the most brilliant aspect of which is, according to one of its sponsors, Congressman Devin Nunes (R-CA), its Medicaid transformation -- which would: a) save the states a trillion per year, the feds $300 million, administratively; b) replace current third-rate medical care with first-class care; and c) provide a template to decelerate health-care spending across-the-board.
With these kind of steps, lawmakers could, in good conscience, raise the debt ceiling, as needed.
Failing such voluntary efforts, a big bucket of cold water will have to do.