Just as people make resolutions for the New Year, so should our elected officials in Washington. With a new Congress and new term for President Obama, 2013 brings an opportunity to step back, reflect, and look ahead. In the spirit of the New Year, the following is a fiscal fitness plan for Washington.
- Lose weight: After decades of record-breaking spending and bureaucratic bloating, the government has gone up too many dress sizes to count. Washington is trying to do too many things that ought to be left to state and local governments or the private sector, and it’s time to go on a diet. Cutting redundant and wasteful programs is a great first step, but we also need to look at cutting programs big enough to put a dent in overall federal spending. Economic recovery will come through downsizing government, not growing it.
- Kick the spending habit: To say that Washington has a spending problem is an understatement. For each of the last four years in a row, it spent over $1 trillion more than it received in revenue. Washington may have unlimited wants, but hardworking taxpayers have finite resources. This means putting a stop to endless stimulus efforts backed by the Obama administration, which failed to deliver on its goals of higher job creation and economic growth.
- Stick to a budget: A key part of fiscal fitness is having a budget and sticking to it. But the Senate hasn’t passed one in over 3 years, and both chambers are woefully behind in considering the 12 annual appropriations bills that provide funding for federal departments and agencies. Congress should resolve to pass a budget in order to monitor its spending and priorities. Short-term fixes, stop-gap measures, and budget gimmicks aren't going to cut it anymore.
- Get a handle on the debt: The national debt exceeded $16 trillion in 2012, and we’re on track to hit the debt ceiling early in 2013. Now is the time to cut up the national credit card and pay down the balance before the interest payments get out of control. If Washington doesn't change course, then it will be an even bigger share of government spending, crowding out other priorities.
- Reform Entitlements: In 2012, entitlement programs—including Medicare, Medicaid, Social Security, and others—accounted for 62 percent of total federal spending .That’s up from only 31 percent, 30 years ago. With more Baby Boomers entering retirement, entitlement spending will skyrocket further, meaning that the government will have to borrow more to cover other spending. Entitlement spending is difficult to control because it is not budgeted annually, instead following the unsustainable pay-as-you-go model. Clearly, an essential step to fixing our national finances is reforming and modernizing our entitlement programs.
Resolutions are notoriously hard to keep, but hopefully Congress will find the dedication in the New Year. These 5 resolutions would set us in the right direction to improving the nation’s finances. Here’s hoping that 2013 will bring a smaller, less intrusive government and more economic prosperity.
Christine Harbin is a policy analyst with Americans for Prosperity.