Wednesday, February 20, 2019

Social Programs and Debt

Recently the New York Times ran an opinion piece about the amount of debt from social programs. Your Grandchildren Are Already in Debt focuses on some of the new social programs being proposed  by presidential candidates. But how will we pay for these programs, as well as existing programs? "On present course and speed, the United States is on track to experience the highest deficits in its history, reaching more than $2 trillion a year by 2029. Those annual gaps are projected to bring America’s total debt to nearly $33 trillion by that date, according to the Committee for a Responsible Budget. That’s double today’s level and more than the size of our economy, a peacetime record."

Here are some thoughts from the author about the situation and its impact

[M]y principal fear is that all this irresponsible borrowing amounts to intergenerational theft. America is simultaneously indulging in two deficit-busting desires: for lower taxes and for robust government programs. Eventually, the interest on all the debt will force the governments of future generations to reverse those fiscally imprudent policies in order to pay for today’s profligacy.

It’s like a couple in their 40s deciding to borrow money to sustain a lavish lifestyle and then leaving the debts for their kids to pay off after they’re gone.

But that’s not all. The generally accepted measure of America’s national debt doesn’t include obligations for future retirement and health care benefits.

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