The taxes we pay don’t cover what it takes to run this country. That’s a serious problem, and not just because we’re spending beyond our means.
In the coming year, the federal government will operate with a budget deficit of $985 billion — nearly one trillion dollars — and we may be looking at two-trillion-dollar deficits by 2028.
Our national debt now stands at about $21 trillion. We pay about $310 billion of interest on that massive debt every year. The debate about how to handle the debt and deficit and how much they really matter rages during each election cycle. But the issue is never resolved, because the obvious ways to address it — by raising taxes and cutting spending — are politically unpalatable.
Instead, as a society we rely on the logic that the debt and deficit aren’t a problem as long as our economy keeps growing, and growing fast, to keep the debt-to-GDP ratio below disastrous thresholds.
By falling back on that specious logic rather than striving for fiscal sustainability, we’re committing ourselves to an economy that requires constant growth to just stay above water. And constant growth hurts a lot more than it helps when it comes to our health, our environment, and our well-being. That’s why the debt and deficit matter — they are two of the chains shackling us to the fallacy of infinite growth.
While a growing economy and GDP have long been markers of a nation’s success, those numbers are blind to growth’s externalities. Ceaseless production has led to rising asthma rates thanks to urban air pollution, financial instability linked to a financial industry that does not prioritize consumers, toxic consumer products resulting from production shortcuts, an ocean at risk of hosting more thrown-away plastic than marine life, and an increasingly unstable climate. The United States, with the 2nd highest GDP in the world, ranks a lowly 43rd for life expectancy, 17th for educational performance, and 14th for happiness.
The traditional measures of a healthy economy don’t account for these negative outcomes; in the land of GDP, more is always better — even when considering it “better” makes no common sense. Based on GDP alone, the 2010 Deepwater Horizon oil spill was a plus — because the cleanup created economic activity. GDP doesn’t care about airline safety improvements; as one observer said, “GDP might prefer a plane crash — so that it can build a new plane.”
We careen down the path of increasing debt, expecting to be saved from financial ruin by growth… but not considering the ruin that growth is pre-programmed to provide.
In tax season, I don’t look forward to filling out my IRS forms any more than the next American. But on Tax Day, I am longing for an honest national conversation about our fallacious assumption that we can grow our way out of our national debt problem, and simultaneously leave our children a home worth inheriting.