With all of the attention given to the presidential elections, it’s easy to forget that the U.S. just ended the 2016 fiscal year. This means it’s time for the annual examination of how much more debt we have!
According to the newest Treasury Department figures (H/T to The Washington Examiner and CNS News), total U.S. debt held by the federal government was $19.573 trillion on October 1. That’s an astronomical amount of debt, quite a bit larger than our current Gross National Product.
As the Examiner and CNS pointed out, and the Treasury numbers confirmed, U.S. debt technically jumped more than $1.4 trillion in the last 12 months. That’s thanks to the Treasury Department temporarily not taking on more debt via use of “extraordinary measures.” Those measures staved off a debt increase from March 2015 through early November — and then the debt jumped hundreds of billions of dollars within a month.
Looking at the Fiscal Year 2016 debt in context to our larger debt picture, the Congressional Budget Office (CBO) projected in August that the annual deficit would be about $540 billion. That’s larger than immediate prior years, but lower than what we’ll see over the next decade. (The deficit and an increase in the national debt are two different things, thanks to how the federal government does its accounting.)
Contrary to liberal tripe about the feds needing more taxes, CBO projects that government revenues via taxes, fees, etc. will rise over the next decade as a percentage of GDP and continue to be above the 50-year average. The real culprit for our growing debt, spending, will go up even more — well beyond the 50-year norm — putting the U.S. at an even worse fiscal position than we’re at now. CBO projects we will add nearly $8.6 trillion to our debt by 2026.
But even this scary scenario, which would likely impact our economy’s growth, doesn’t tally up the worst of it all. The big-picture analysis most often cited by media outlets is the “baseline” projection by CBO — the optimistic one. In the August projections, CBO gave a list of alternative fiscal scenarios that could play out, depending on the decisions politicians make. A quick tally of those scenarios shows that the debt could be as much as $2.755 trillion higher than the positive projections, or $792 billion lower.
Short version: We don’t need more taxation. We need more economic growth and less spending. However, neither party wants to effectively reform the entitlements (Medicaid, Medicare, Social Security, food stamps, and other parts of the budget that don’t get annually approved by Congress) that are the major cause of our budget increases in recent years, and are projected to, for the most part, rise in cost. And effective tax reform is nowhere to be seen.