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The federal government continues to borrow $5 billion per day. Despite significant tariff revenue and large one-time student loan savings, our deficit is just as large as last year's and shows no sign of decline.
Driving home the message that Washington has traded fiscal responsibility for total dysfunction, these deficit totals came to us while the federal government is in its second week of a shutdown. Our debt is headed for a record share of the economy and we’re posting nearly $2 trillion deficits outside of an emergency or recession – how do our leaders expect to deal with any of that when they can’t agree on keeping the lights on?
Reopening the government without tying it to massive new borrowing should be the bare minimum and needs to be accomplished as soon as possible.
Once we have a functioning government again, we have a long road ahead of us in this new fiscal year. We need to stop treating the budget like it’s on autopilot; on the contrary, we need to reestablish guardrails to prevent the debt from exploding. That means extending the discretionary spending caps that helped control spending the past two years as well as offsetting new policies with twice as much savings, or “Super PAYGO.”
And we urgently need to enact trust fund solutions to curb the cost growth and prevent insolvency for our major trust funds like Social Security and Medicare.
Policymakers have been treating the budget as if it has no consequences for far too long. This past fiscal year is proof enough of that. Before we lose our standing in the world irrevocably, Washington needs to make a pivot now to the basics and necessities of responsible budgeting.
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