State of Union speech 
ignores debt worries

Phew! Aren’t you glad that’s over — all that annoying anxiety about our growing national debt and the annual federal budget deficit?

It’s time to put that behind us and concentrate on other matters, such as additional spending to rebuild infrastructure and to pay for more preschool, President Barack Obama said Tuesday night in his State of the Union address.

Of course, we and many others still believe reining in the federal debt is crucial, and now is the time to do it.

The effort is not just an abstract exercise in federal accounting. If the debt continues to worsen, our credit rating will dive more than it has, fewer individuals and organizations will be willing to purchase U.S. Treasury bonds and our ability to borrow money for needed projects in the future, such as the highways and bridges Obama wants, will plummet. Our economy will soon look more like Greece’s.

Obama did pay lip service to the federal debt during his Tuesday-night speech, saying, “Most of us agree that a plan to reduce the deficit must be part of the agenda.” However, he added, “But let’s be clear: Deficit reduction alone is not an economic plan.”

That’s true enough. But arguing, as Obama did, that we’ve accomplished most of the deficit reduction we need, then proposing billions of dollars of new spending, is not a sound economic plan either.

And the president’s claim about his spending ideas — “Nothing I’m proposing tonight should increase our deficit by a single dime” —  was met with skepticism, both by Republican lawmakers and members of the mainstream media. That skepticism is entirely justified, since Obama offered no details on how the spending would be paid for or what other budget items might be cut.

Some of what Obama said Tuesday was welcome, if he follows through with it. For instance, he talked of reducing red tape that slows oil and gas exploration and production in the United States. We’re all for that.

He also spoke of making some “modest reforms” to Medicare, such as reducing money going to prescription drug companies and asking “more from the wealthiest seniors.” Although most observers believe such reforms don’t do nearly enough to avoid the fiscal train wreck that’s coming with Medicare, the proposed reforms are a step in the right direction.

But Obama’s ongoing refusal to push any realistic action to deal with the debt and deficit is deeply disappointing.

Tennessee Sen. Lamar Alexander, one who is worried about the debt, said Wednesday there is a group of 30 to 40 senators of both parties who are ready to work on a comprehensive debt-reduction deal once the president becomes more engaged.

It should be clear by now Obama will never be more engaged on the debt issue, and they must proceed without him — or despite him.


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Today’s editorial – “State of Union speech ignores debt worries” – selectively disregards the text of President Obama’s address and the context created by Republicans’ ongoing obstructionism and “manufactured crises”.

Indeed, while President Obama refused to exacerbate the exaggerated “worries” fueled by his intransigently partisan critics, his speech expressly addressed the long-term debt.

Our $16+ trillion national debt has four principal sources:  the Bush Tax Cuts, two wars, the Medicare prescription drug benefit, and the financial crisis that contracted our GDP in 2009.  President Obama has systematically addressed each of these underlying causes.
While the Bush Tax Cuts deprived the federal government of $1.6 trillion in revenue, the “Fiscal Cliff” deal recouped only $600 billion of that—but President Obama has agreed to some $1.9 trillion in purported spending cuts since 2011, and has reduced the federal deficit every year he’s been in office. 

President Obama also ended one war and announced the projected end of another.  His proposed Medicare reforms include reducing subsidies to the prescription drug industry.

“As a result, we are more than halfway towards the goal of $4 trillion in deficit reduction that economists say we need to stabilize our finances”, the President reported.  That goal is based on the debt-carrying capacity of our economy – measured as percent of GDP.

Republicans falsely insist that we face only a “spending problem”—not a companion “revenue problem” – despite mounting evidence that all levels of our governments are chronically underfunded.

President Obama and reputable economists maintain that additional fiscal “stimulus” (i.e., infrastructrure spending) – paid for by “tax reform” and/or by borrowing now at negative interest rates – will “create jobs” and thereby increase GDP.

Republicans claimed that the 2009 stimulus “wouldn’t work”, then “didn’t work” – but it did.  Therefore, the Sentinel should be endorsing polices that work, not parroting ideology that doesn’t.

                Bill Hugenberg

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