The federal government is on an unsustainable course, it is sinking, but we don’t have to sink with it.
Right now, the national debt is approaching $19.75 trillion (U.S. Treasury). With current GDP in the U.S. at $18.45 trillion (U.S. Bureau of Economic Analysis), our debt-to-GDP ratio is at 107% re-approaching the WWII record. This is not far behind Italy (136%) and headed toward Greece (176%). China is far more fiscally disciplined at only 22.4%.
Existing commitments to Social Security and Medicare will add no less than $9 trillion more to our already staggering financial burdens in the next decade. And, who knows what additional debt will come from ever-increasing Obamacare commitments? It can’t be good.
New presidents usually talk about reducing spending, but few have done it. Spendthrift congresses often win out. In short, our once-responsible country is on an unsustainable course. The national ship is sinking and our leaders, like drunken sailors, will flood the decks even more.
Idaho, like many other states, is moored to the federal sinking ship. Over 35% of Idaho’s budget comes from federal grants and commitments. For public education in Idaho, we count on $311 million in federal funds. For our Department of Environmental Quality, we count on over $30 million from the federal government—more than half the budget. And for transportation, nearly half (48%) of the $496 million in appropriations are federal dollars.
These ties to the federal budget are distressing for a couple of reasons. First, the federal government budget is doomed—it simply cannot sustain its current course. In the past, when the federal government hit financially troubled waters, they shifted more burden onto the states by increasing the states’ shares of the costs, raised taxes, issued more debt, etc. But this can’t continue. All of these areas are already pushed to the breaking point.
Idaho should not make plans on the assumption the federal government will continue its “generosity” to the states. We should not take the feds at their word about committing to pay 90% of Medicaid expansion costs. The feds break promises over and over. Social Security was never supposed to cost more than 6% of earnings; now it’s at 12.4%—a broken promise. The same goes with Medicare. And, somehow we’re supposed to believe the feds will only ask Idaho to cover 10% of Medicaid expansion costs, forever?!
Second, when Idaho is dependent on federal funds it is a slave to federal policies. The federal government dictates Idaho follow Common Core testing policies—or lose funding. Idaho must incorporate and enforce all federal environmental laws—or lose funding. Idaho must adopt all federal transportation mandates—or lose funding. Mandates accompany every federal dollar into Idaho.
If Idaho wants its freedom to choose its own course in virtually all areas of public policy, and if Idaho wants to save itself from an inevitable catastrophe when the federal ship finally breaks and founders to the sea bottom; Idaho should and must sever the chains mooring it to the federal, financial ‘Titanic.’
We are a self-sufficient people and we can and should return to being a self-sufficient state of the U.S.. Our financial security and our state sovereignty, indeed our future, all depend on it.
Ronald M. Nate, Ph.D.
State Representative, District 34-A