If everyone in America, other than President Barack Obama and Congressional Democrats, is glum over the passage of “Obamacare,” there is a silver lining: The bill’s passage will finally force the country to face our dire fiscal circumstances and bring the kind of clarifying election that could lead to America’s fiscal salvation. Or not.
[IMGCAP(1)]Even before passage of Obamacare, here are the fiscal facts that America faces in 2010: Our deficit will be more than $1 trillion for the second year in a row. Our cumulative national debt is careening toward the $13 trillion mark, and it will reach at least $16 trillion by the end of a second Obama administration.
The amount of interest that the government paid on our debt last year was $319 billion, more than we spent on space exploration, transportation and education combined. That number could easily double in the next several years, especially if the government loses its AAA bond rating.
On top of that, Medicare is going broke. The latest report of the actuaries responsible for managing the program noted that the current insolvency date is now 2017, conveniently the year after Obama leaves office, if he gets a second term. Obamacare promises to cut $500 billion out of this program, not to save Medicare, but rather to start yet another entitlement. Without substantial program reform, passage of Obamacare will only hasten the insolvency of Medicare.
Remember the story of the liberal who throws a rope to a drowning man but, before reeling him in, leaves in search of someone else to save?
Given the magnitude of the structural deficit, it is laughable that Democrats actually boast that Obama’s health plan would save $138 billion cumulatively over 10 years. That equals roughly five weeks of current deficit spending by the administration. That figure assumes that against all evidence Congress actually imposes a tax on high-benefit health care plans on Star Date 2018, reduces payments to doctors and other providers, and enacts many other things that it doesn’t have the courage to do now.
The point is that Obamacare and his administration’s other spending programs will more likely explode the deficit further, threatening hyperinflation, interest rate increases, continued high unemployment and massive dislocations in the American economic system. We are about to go back to the 1970s, only the underlying problems will be far worse. None of the administration’s tax increases, and there are many, can change this basic fact.
The stage is set. Republicans can and will run the next two, or even three, elections against massive deficits, tax increases, out-of-control entitlement spending and the frightening growth of a leviathan federal government that can no longer be said to possess only limited enumerated powers. It says here that the GOP will have great success with these arguments and win lots of elections, including both chambers of Congress, even if Obama is re-elected in 2012. Democrats’ willful blindness ensures hard times ahead for the party determined to “make history” rather than heed the clear will of the public.
The more critical question for this country is this: Will Republicans elected on this platform finally step up to the plate and govern the way we campaigned? Strong limitations on spending are necessary, including major reforms of Social Security and Medicare to keep the promises that we have already made to generations. We failed in this task last time. Next time could be our last chance.
Fortunately, the situation is now so dire that the country is prepared to listen. Rahm Emanuel was right after all: A crisis is a terrible thing to waste.
Frank Donatelli is chairman of GOPAC, which works to train and elect Republican candidates.