On our national debt

As our debt climbs, the anxiety climbs and the options to solve our fiscal crisis shrink. The nation has watched the Executive and Legislative branch become more and more dysfunctional in the past 20 years, now it is reaching a fever pitch.  The frustration across the country matches the frustration in Washington.

What we are experiencing as a nation is similar to what a marriage experiences when the couple is heavily in debt.  Millions of marriages fail because the husband and wife constantly fight over money.  Without question, a marriage is more likely to succeed when the family is not in debt.

Our national marriage is on the rocks.  The tension in the nation is incredible.  Half our nation wants to spend more and tax more to solve the economic malaise, knowing that we are deeply in debt but hoping that if the economy starts to grow again, we will hopefully get out of debt.  The other half of our nation strongly believes that our national debt is choking our economy, and we will never pull out of this economic crevasse by adding more debt; believing when you find yourself in a deep hole, the first step to get out is stop digging.  Both sides of the aisle believe we have too much debt, but the solutions are polar opposites.

That brings us to the status of the fiscal cliff. In the last lame duck Congress, all tax rates were put on a 24-month expiration to January 1, 2013.  Just a few months earlier, when the Affordable Care Act passed in the last Congress, they also increased taxes on people making more than $200,000 per year and took medical deductions away from Middle Class families starting January 1, 2013.  On top of both of these tax issues, the Alternative Minimum Tax (AMT) expires December 31, 2012, which means that millions of Americans (those making more than $45,000 per year) will have a dramatic tax increase for their 2012 tax bill if the AMT is not “patched” before January 1, 2013.  Due to the budget agreement of 2011, unless we can agree to find other places to reduce spending, we will also have a mandatory 8-10% cut in every federal agency starting January 2, 2013. While there is no question that $100 billion in waste and fat could be identified in the federal budget, when the cuts happen in the middle of the year, they are very difficult to implement.  But we must cut spending.

For some perspective, in the past five years spending has increased $1 trillion dollars.  If our spending in 2012 was the same as 2008, we would have a balanced budget today.  But, unless something changes quickly, we will add more debt in eight years than the previous 230 years combined. 

In 2012, the federal treasury received the third-highest amount of tax revenue in the history of the nation.  Most people do not know that even while the American paycheck has stagnated, the taxes to the Treasury have increased almost $500 billion in the past five years.  Until we reduce our federal spending, we will not solve this problem.

I do not want us to just “do something,” I want to fix the problem.  I think most Oklahomans also want Congress to work together to solve the problem.   The Washington rhetoric sometimes overlooks the fact that the fiscal cliff will affect all of our lives and families.

So, what happens now with the fiscal cliff?

Negotiations are still ongoing with the White House. As you may know, the House passed a tax proposal in August and our sequestration solution in May. We are still waiting for the Senate to pass something and send it back so that we can negotiate in a House / Senate conference.  It is our hope that the Senate will pass a counter-offer or the President will compromise with the House to reduce some spending in the federal budget.  We are all focused on the issue and especially during this Christmas season, it is the right time to come together to resolve the first of many battles over our national deficit.