"A democracy is always temporary in nature. It simply cannot exist as a permanent form of government (because) voters discover that they can vote themselves generous gifts from the public treasury. From that moment on, the majority always votes for the candidates who promise the most benefits from the public treasury, with the result that every democracy will always collapse due to loose fiscal policy."
- Alexander Tytler, 18th-century Scottish historian as quoted by Gerald J. Swanson, in America the Broke
The late editorial cartoon master Jeff MacNelly once depicted Social Security as a vending machine. Near the coin slot, it said, "Insert your grandchildren here."
We've nearly come to that point - with all federal spending.
"With few exceptions," writes Gerald Swanson, professor of economics at the University of Arizona and author of America the Broke, "our political leaders, Republicans and Democrats alike, have abandoned all pretense of fiscal responsibility. Spending is out of control, further ballooning the highest national debt in the history of the world. ... (O)ur current plight could touch off a world financial crisis and another Great Depression."
Even if it never goes that far, the nation's fiscal course is set for a disaster that will be visited upon your children and grandchildren.
And it is this generation that will be responsible.
"Abun-dance," Swanson writes, "can produce selfishness, self-indulgence, greed, complacency and apathy, until liberty itself is in danger.
"That the United States of America can literally go broke is no longer a fantasy but a likelihood ..."
There is some dispute over whether the quote Swanson and others attribute to Tytler really came from the 18th-century historian. But there's no disputing the evidence that the words are proving prescient: Our leaders are spending America into bankruptcy - at our urging.
As of late last week, the national debt was $8.7 trillion - $28,863 per person - but the debt clock has kept spinning since we checked. It's higher today, as it will be tomorrow.
IN HIS STATE of the Union address, President Bush Tuesday confronted three aspects of the coming federal budget disaster: balancing the budget, ending earmarks and reining in entitlements.
The president's remarks were superb - as far as they went. Sadly, he didn't recommend shrinking the actual size of the government, as a financially strapped business would do. But of course, when the GOP tried to do that in 1994, and temporarily shut down the government to dramatize the need, Americans sided with President Clinton and the spenders.
At that moment, it seems the Republican Revolution was lost. And the Republicans with it.
Moreover, President Bush can't just talk the talk of budget reform. His predecessor did that much. We need action. Bold action.
Nor can Washington take much credit for the temporarily balanced budget in the 1990s, or the fact that Bush's goal to cut the deficit in half by 2009 was reached three years early: These things occurred not through any brilliance or courage or discipline of our elected leaders, but through the hard word and productivity of ordinary Americans.
The onus is now on our leaders to act in our best interests - even if the gravitational pull of elections takes them in other directions.
The president needs to mean it, and Congress needs to act, when he tells the joint session of Congress, "Social Security and Medicare and Medicaid are commitments of conscience - and so it is our duty to keep them permanently sound. Yet, we are failing in that duty - and this failure will one day leave our children with three bad options: huge tax increases, huge deficits, or huge and immediate cuts in benefits.
"Everyone in this chamber knows this to be true, yet somehow we have not found it in ourselves to act."
The president is calling on Congress to balance the budget by 2012 - and to end the practice of looting the treasury for pork projects through stealthy "earmarks" that are slipped into bills "when not even C-SPAN is watching," he said.
All that would be a great start. But even as egregious and offensive as the practice of earmarking is, at $18 billion in 2005, it represents less than 2 percent of the federal budget.
And balancing the budget will be meaningless unless entitlement programs are brought under control.
AS IT STANDS now, there really is no Social Security trust fund: Congress takes your retirement funds and uses them for current operations of the government, in an effort to keep the deficit down and to make the finances look better than they are.
In the private sector, they call that a felony.
Even as our leaders fill our retirement coffers with iffy IOUs, they're fiddling while Rome burns: According to the Congressional Budget Office, spending on Social Security, Medicare and Medicaid will eat up the entire federal budget - including defense spending - by mid-century.
Much sooner - perhaps before 2020 - Social Security will begin spending more than it is taking in. And while it used to be that as many as 16 workers supported one retiree with their Social Security taxes, by 2030 the ratio is expected to be two workers to each retiree.
What happens when that generation finds it nearly impossible to support their parents?
In short, the makings of generational class warfare.
"Our children may be faced with the choice of paying retirement benefits to their parents or paying for programs that help their own children," says the Web site socialsecurityreform.org.
In the short term, entitlement spending will make it difficult to balance the budget: The Congressional Budget Office last week said entitlements are expected to push the budget deficit to $367 billion by 2012 and $704 billion by 2017 - and that's even as tax revenues are on the increase.
In the long term, even balancing the current federal budget will be pitifully short of what's necessary to avert disaster - like "digging a moat around a sand castle when a tsunami is approaching," writes the Heritage Foundation's Alison Acosta Fraser.
"This tsunami is not so far away, either," she notes. "It will start in 2008 when the first baby boomers retire and the huge tidal wave of spending that will swamp the federal budget starts to come our way."
"Reforming Social Security, Medicare and Medicaid is the only way to get the budget under control," says Heritage's Brian Riedl.
Medicare and Medicaid costs are actually growing at a faster rate than Social Security: about 8 percent a year, versus 6 percent for Social Security. And combined, Riedl says, Medicare and Medicaid already account for more spending than Social Security.
As gargantuan as the national debt is, Riedl says it's still below the post-war average of 44 percent of gross domestic product. "The much larger threat is the trillions in future costs associated with Social Security, Medicare and Medicaid," he writes.
SO WHAT TO DO?
Here are some ideas:
- As to discretionary spending, Congress should immediately heed the president and end the practice of looting through "earmarks" and pork. Nothing in the Constitution allows the federal government to take your money and simply give it to someone else.
- Congress must balance the budget as soon as possible, and keep it there.
- To impose some fiscal discipline on themselves, we urge Congress to pass a Taxpayers' Bill of Rights (TABOR) that would restrict the growth of federal spending to the inflation rate plus population growth. It's a method touted by the Heritage Foundation's Riedl, and used to great effect in Colorado.
Riedl estimates the TABOR would drop the growth in federal spending from about 6.4 percent a year to 3.3 percent - and save about $4 trillion over 10 years.
- More than anything, Washington has to wake up to the entitlement entanglement this country is snared in. There are many options to consider, including phasing in higher retirement ages, trimming future benefits and perhaps even means-testing some.
We realize the word "privatization" frightens many people when paired with "Social Security." But the truth is, Congress is spending your retirement nest egg today - and that's not threatening you, it's endangering your children and grandchildren.
There's no vending machine into which you must insert your grandchildren.
But the effect is the same.
For their sakes, it's time our leaders actually did some leading.