Time for a Recall Tue. 03.16
The United States is approaching a financial cliff. A steep precipice that would threaten our position as a leading economy. A normal government would slam on the brakes. But we have the Toyota of governments. Our spending accelerator is jammed.
The latest road sign telling us to slow down is a Moody’s Investor Service quarterly report that analyzes the prospects of triple-A rated countries. According to the report the United States has moved “substantially ” closer to losing their AAA credit rating because our debt affordability has become the “most stretched ” in relation to other top countries. Pierre Cailleteau, managing director of Moody’s said ,
“At the current elevated levels of debt, rising interest rates could quickly compound an already complicated debt equation, with more abrupt rating consequences a possibility.”
Unfortunately, the “current elevated level of debt,” is merely the tip of the proposed ice-berg in President Obama’s proposed budget. The President’s budget would more than double the current debt, accumulated over our nation’s history. It would also drive spending to a record high of $3.8 trillion in 2011 and add $9.8 trillion to the deficit over the next decade. By 2020, the Congressional Budget Office estimates that the debt held by the public would reach $20.3 trillion – 90% of GDP.
Even if we do get around to applying the brakes to this situation, Moody’s warns that
“Growth alone will not resolve an increasingly complicated debt equation . . . Preserving debt affordability at levels consistent with AAA ratings will invariably require fiscal adjustments of a magnitude that in some cases, will test social cohesion.”
Social cohesion is already being tested in the United States. Not because cuts the public is up in arms over slashes to government programs, but because the government is planning on adding a trillion dollar health care entitlement. The public is ahead of the government learning curve. Despite Treasury Sercretary Tim Geithner’s claims that a lower credit rating “will never happen to this country,” the public is legitimately concerned. There is no aura of financial indestructibility, we’re calling it like we we’re seeing it, and we’re seeing runaway spending.
Voters are demanding a fiscally sustainable path. They’ll get it, either now or come November. The Democrats are an out of control Toyota, threatening the futures of every passenger. It is for a recall.
by Brandon Greife, Political Director of the College Republican National Committee
Read more: www.collegerepublicans.org