Putting the US Budget Problems into Perspective

There’s been lots of back and forth about Obama proposed budget and the trillions of cuts he wants to make, which, surprise!, aren’t enough for some republics, who want to slash the budget by $61 trillion.  The problem, is neither the Democrats, nor the Republicans want to slash money from entitlement programs — social security, medicare, medicaid, et al. — or from discretionary spending — the department of defense.

And really, without tackling those two prongs of the US budget, the politicians on either side of the aisle are never going to solve the debt problem.

Annie Lowrey published a piece on Slate that puts the federal budget in perspective:

For our purposes, let’s use $60,000 as the government’s income and $85,000 as its expenses.

Where does all of that spending go? Mostly, to mandatory programs, spending that does not change much year-to-year and is not easily reduced. But given that mandatory spending makes up about 60 percent of spending, if the debt is going to come down, these are the line items that need to change. Next year, Obama is requesting $17,400 for Social Security, $10,700 for Medicare, $6,100 for Medicaid, and $13,600 for other mandatory programs such as food stamps. There’s no way around any of those expenditures, which total about $48,000—or more than three-quarters of the federal government’s annual income. (Last year, mandatory spending alone actually exceeded income.)

Then she tackles the discretionary side of things:

First and foremost is security spending. The country needs to fund the Afghanistan war and the Department of Defense. This is not cheap: In fiscal year 2012, Obama is asking for $20,000 for overall security costs.

So far, my friend, you’re at $68,000. No cuts yet, and you’ve already blown your budget by about $8,000. But wait—there’s more, as they say. You have to pay for all the debt you’re ringing up. This year, you are on the hook for $5,500, and that is just for interest payments to creditors. So you see the problem here: Before you’ve even gotten to anything that anyone even talks about cutting, you’re already about 25 percent over budget.

And so long as that’s the case, the US budget will always be problematic. I don’t know what it’ll take for politicians to do something and address this — do they think Americans can’t or won’t be able to handle an honest discussion about the budget woes? Most citizens intuitively understand this dilemma, especially when you put it in terms like Lowry does. [via dailydish]

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