One of the long term problems faced by the United States is the issue of the budget deficit and the long term debt that is being compiled. While many try to make it a partisan issue the fact is we’ve had Presidents and Congresses of both parties overspending for decades. Recently spending has soared due to the sagging economy and the argument has been that we need to spend in order to prevent economic chaos.
However the ultimate solution to the US problem may be found not in Washington but in Dublin.
Ireland has in recent months adopted a very aggressive program to slash their deficit and they are doing so even when it hurts. They have cut more than $ 4 billion in spending, the President is taking a 20% pay cut and more that 400,000 government employees will take pay cuts as well. These cuts will not be easy to absorb, there will be people who have to really cut back on basic spending.
At the same time they are also increasing taxes, particularly on the wealthier brackets, in order to increase income
The basic concept on both ends is that they are going to sacrifice now in order to present a better future for their children. They accept that the spending of the past can not be sustained in the future and so they are making changes now, even if it hurts, to fix the problem.
I think this is an example that we need to take a serious look at. The simple fact of the matter is that we cannot continue to sustain the current spending let alone trillions of dollars more. At the same time when you look at that spending which has to be maintained we cannot do it on the current level of income.
So both sides need to yield on some of the core issues. Republicans need to accept the reality that we need increased revenue and that is going to require tax increases. While we should try to share this burden we need to accept that the higher income brackets are better able to absorb these increases and thus they will have to take a harder hit. While there is probably a small group that genuinely hates the rich and thus likes this idea I think most of us wish we didn’t have to tax more but this is just a reality.
On the other side of the equation, the Democrats meanwhile need to accept that spending cuts are going to happen. It’s wonderful to want to provide for people and help them have a better life. But we can’t give everything to everyone and there are going to have to be some cuts that will hurt. We are going to have to reduce spending even on programs we like because there is a limit to how much you can ‘tax the rich’ and money doesn’t grow on trees.
Just as the rich will have to accept a heavier burden in increased taxes the poor will almost certainly suffer a greater burden in the spending cuts. Obviously this is something we would like to avoid but the simple fact is that the less fortunate depend more on government support so any cuts are going to hurt them more. Again there may be a small group that truly adopts the attitude of ‘let them eat cake’ I think most of us wish the cuts didn’t have to happen but the reality is they do.
Obviously all of these issues will require considerable debate and investigation. You have to be careful to make sure that the spending cuts and tax increases are done in as careful a manner as possible in order to avoid doing too much harm. But if we are going to make our way out of this mess it is time to start accepting some harsh realities and trying to build a better future for our children and grandchildren.