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Do We Have a Debt Crisis?

After four years, Congressional Democrats have finally produced a budget. The process has proved revealing: the Democrats’ budget never balances, increases spending by 62% over ten years, and adds $7 trillion to the national debt despite raising taxes by $1.5 trillion. So Senate Democrats must agree with President Obama that the nation does not face a debt crisis.

In an interview yesterday on ABC, Obama repeatedly expressed this conviction:

[W]e don’t have an immediate crisis in terms of debt. In fact, for the next ten years, it’s gonna be in a sustainable place….

There’s not–-in any way–-an immediate crisis with respect to our finances. …

Obama used the word “immediate” to qualify his lack of concern about the debt. But what does that qualification mean? We know from the budgets he has submitted for the last four years that Obama doesn’t care about the debt, immediately or otherwise, and has no intention of addressing it, ever. His budgets contemplate nothing but huge deficits as far as the eye can see, and would add trillions to the national debt through ever-increasing spending.

We now know that Senate Democrats share Obama’s cavalier attitude toward the nation’s finances. Far from seeing a crisis, they propose a budget that adds $7 trillion to the debt, even on unrealistic revenue assumptions that depend on a sudden explosion in GDP. Just a few minutes ago, the Senate Budget Committee voted on two amendments, proposed by Senators Sessions and Johnson, that would have required a balanced budget after ten years. The committee’s Democrats–Murray, Wyden, Nelson, Stabenow, Sanders, Whitehouse, Warner, Merkley, Coons, Baldwin, Kaine and King–voted the amendments down unanimously.

Currently there are around 115 million households in the United States. With a national debt now approaching $17 trillion, those households owe an average of nearly $150,000 apiece. Assuming the Democrats’ optimistic assumptions are correct and their budget adds $7 trillion to the total debt, the average household’s share will rise to more than $200,000. The median American family has a net worth of around $77,000.

Currently interest rates are near zero, but that situation won’t last much longer. If the federal government were paying just 3% on its $17 trillion debt, it would blow a $500 billion hole in the federal budget. (The Democrats’ budget actually contemplates that by 2019, the government will spend more on interest than on national defense.) If this isn’t a crisis, what is?

The Democrats want to kick the can down the road. Who lives down the road? Our children do:

Senate Democrats have now joined President Obama in a complete abdication of responsibility on the most vital issue of our time. Either they will pay a political price, or the nation will continue hurtling toward financial collapse.

UPDATE: Here you see the Democrats voting unanimously against any attempt to slow the growth of federal debt. Only in the Alice in Wonderland world of Washington could Patty Murray say with a straight face that her budget constitutes four trillion dollars in debt reduction when in fact, even on its own unrealistic assumptions, it increases the debt by $7 trillion:

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