By ERNEST F. HOLLINGS, former U. S. senator
SEPT. 10, 2008 -- I'm saddened. Here comes "the best of the best" scaring the daylights out of everybody in a two-full-page ad in the Sunday New York Times on September 7, 2008, with a $53 trillion hole in the federal budget supposedly caused by Social Security and Medicare entitlements.
group must know of the CBO study of the cause of the increase in the national
debt -- the first four years of President George W. Bush's term. The CBO
finding: 48 percent due to tax cuts, 37 percent due to war and security
costs and 15% due to increased spending. The devastating affect of Bush
tax cuts over the past eight years have added over $4 trillion to the
debt. But averaging a $500 billion deficit each year for eight years -
hardly a peep out of the eminent Peter G. Peterson or Concord Coalition.
I have the highest regard for both. I've worked with them. And now there
is the Peterson-Walker initiative on the budget. But somehow they get
lockjaw when a Republican president takes over, and only surface when
a Democrat might take over.
None other than Alan Greenspan set the scene for tax cuts on January 25, 2001, when he testified that we were "paying down too much debt." At the moment of his testimony, the Secretary of the Treasury reported that we were $65 billion in the red. But the Secretary of the Treasury was soon to be given his walking papers and the idle rich got a tax cut causing us to go from "surpluses as far as the eye could see" to increasing the debt by $4 trillion.
"To the Presidential Candidates and the American People," the
ad states: "Federal office-seekers cannot realistically be expected
to propose detailed plans for Medicare, Social Security, health care,
and other spending and tax reforms during campaign season." Why not?
For over a year that's exactly what they've been doing. And we have almost
two months to go before election day. It is the two-page ad that is unrealistic.
As of this minute the Secretary of the Treasury reports a deficit for
fiscal year ending on September 30th of $722 billion. Rather than advertise
an impossible "$53 trillion" hole, it ought advertise the reality
- a $700 billion deficit that one of the candidates will be faced with
in January. That means that before money can be appropriated for health
care, infrastructure and energy that both candidates are promising, we'll
have to cut spending and increase revenues $700 billion before we have
money for new programs. The next president will at best have to set a
course for recovery with a budget freeze, spending cuts, and tax increases.
This is exactly what was required in 1993 when we changed course and fixed
the economy for its best eight years in history. Of course, it wasn't
easy. Half of the Senate and House of Representatives in government committed
not to pay for government is a cancer on democracy. This is the scandal
that should be exposed in a two-page ad.
cuts have caused the national debt to increase $4 trillion, requiring
an annual payment of $200 billion in interest costs each and every year
until the debt is eliminated. The ad should point out that the President
and Congress in eight years have launched a new $200 billion spending
program for nothing. This is the waste that we've got to stop next year
- not any $53 trillion hole.
continue to get a bum rap in the ad. Both Social Security and Medicare
are in surplus. Yes, something will have to be done about health care
costs. But Social Security presently has a surplus in excess of $2.4 trillion,
with another surplus this fiscal year of $198 billion. These surpluses
will carry the program through 2041. In 2017, instead of adding to the
Social Security surplus, we'll start spending from the surplus. The Social
Security bonds will have to be honored, and the President and Congress
in 2017 will be looking for money to honor these bonds. This is the reality
which the ad ought signal - not a $53 trillion hole.
the ad mentions a trade deficit without mentioning its principal cause
- outsourcing! Since NAFTA with Mexico and Permanent Normal Trade Relations
with China, we have outsourced our jobs, outsourced our production, outsourced
our research, outsourced our investment, outsourced our economy. Tax cuts
have caused a cheap dollar, and what production has not been outsourced
is now being bought up with the cheap dollar. We've even outsourced our
business and financial leadership. Every attempt in Congress to put a
tourniquet on the outsourcing gets knocked down by the business leadership
shouting "free trade," "protectionism." The banks
and business in their zeal for profits have forgotten about the economy
and the country. At the same time that the federal government is financing
outsourcing, the states are headed in the other direction, with Tennessee
putting up $577 million to get Volkswagen and Mississippi putting up $300
million to get Nissan. The local Chambers of Commerce are making every
sacrifice to create jobs while the United States Chamber of Commerce lobbies
to get rid of them. The country has got to get its act together. Globalization
is nothing more than a trade war for market share with government as a
"comparative advantage." The United States government is AWOL
with its generals as a fifth column. The signatories know this and, rather
than boosting the banks and multi-nationals for bigger profits with this
scandalous ad, they ought to be preparing the American people to compete
all, the "people of America" should be preparing once and for
all to sacrifice. We keep borrowing to pay for the wars in Iraq and Afghanistan.
We're asking young GI's not only to sacrifice and die; but if they are
lucky enough to come home, they're the ones who'll pay for the wars. We
are not going to pay for them - we need a tax cut! The ad ought to emphasize
that tax increases will be necessary.
As a member of the Senate Budget Committee for thirty years, I have worked with the principal signatories to this double-page ad. They know the nation has to sober up from this binge. Charging the candidates and people now with an understanding of the sacrifice necessary in January is more in order rather than scaring them for a blue-ribbon commission. They ought to be ashamed.
Ernest F. Hollings served as governor of South Carolina from 1959 to 1963 and as a United States senator for the state of South Carolina from 1966 to 2005. He is the author of Making Government Work (2008).
© 2008, Ernest F. Hollings. All rights reserved. Contact us for republication permission.
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