It’s time to start talking again about the deficit and not dismiss those fretting about the mounting federal debt, now approaching $34 trillion, as Chicken Littles.

The yearly deficit has topped $1 trillion — once a nearly unimaginable figure — now for several years running. It was $1.7 trillion in the fiscal year just concluded, and the financial world barely cocked an eyebrow. The federal government has no problem floating debt; the dollar remains strong.

This won’t last. Even America, as economically powerful as it is, can’t run on a credit card forever.

Without action, U.S. debt eventually will become unappealing to investors. The feds then will need to offer investors ever higher yields, exacerbating the situation.

Interest on the federal debt now accounts for about 10% of the budget. To put that in context, expenditures for all nondefense discretionary programs make up 15% of the budget.

On the present course, according to the U.S. Government Accountability Office, interest will eat up more than a quarter of the budget by 2051.

So, yes, federal spending is unsustainable.

What has brought us to this moment in no small part is the return of inflation and the consequent need for higher interest rates. For years, the federal government floated bonds at rates that essentially were the equivalent of free money. No longer. The current yield on the 10-year Treasury bond tops 4.5%.

A serious issue requires serious people. The political problem currently is that the only lawmakers beating the deficit drum are far-right Republicans in the House, many of whom are using their legitimate concern about profligacy to advance positions on social issues or, for example, to attack support for Ukraine — spending that is overwhelmingly in the national interest.

Some among the House GOP have further contaminated the budget-imbalance discourse by repeatedly threatening to shut down the government in order to gain political leverage. Shutdown politics has proven to be a loser time and time again for Republicans.

These machinations make it that much harder for serious legislators even to broach the subject.

Once we get past the shutdown silly season, though, those lawmakers — and whomever wins the White House next year — will need to do precisely that. Setting up a solid process will be as important to any future success as the substance of an eventual solution. There’s no hope without, first, a clear statement from both parties that current budgets are unsustainable and, second, a will to establish a process that provides even a chance of producing some sort of grand bargain.

We’ve seen seemingly intractable issues addressed in creative ways before. Some will recall how the U.S. had far too many military bases and needed to close many of them. Parochial action by lawmakers intent on preserving bases in their districts got in the way. Congress in 1990 established a commission to recommend closures and required legislators to vote them down to keep them from taking effect. It’s worked.

Many won’t remember, but the 1980s featured several deficit-reduction efforts involving budget hawks from both parties. There was 1985’s Gramm-Rudman-Hollings law, which sought to tamp down the large deficits during the Reagan era. That didn’t work, but Clinton-era tax increases combined with the economic boom of the 1990s produced budget surpluses.

Since the dawn of the 21st century, however, a combination of ill-advised tax cuts, wars and economic crises and pandering to big-spending progressive agendas have brought deficit spending back with a vengeance. The bipartisan rump groups of the ’80s weren’t particularly successful, but that doesn’t mean such an effort couldn’t be now.

As was the case nearly four decades ago, lawmakers from both parties have to buy into the project in order for it to have any chance to succeed. Likewise, the president has to provide vocal support, spending political capital to give it momentum.

Social Security, Medicare and Medicaid, federal insurance programs whose spending is on autopilot, will have to be part of any cuts, since together they account for 45% of federal outlays. Those safety-net programs have proven to be political “third rails,” so any trims to them likely would have to be needs-based.

In short, those who can sacrifice would have to be willing to do so, and the pain would have to be perceived as reasonably shared.

A very tall order, we understand. The professional political class believes it’s impossible. The current state of our politics backs that up. Donald Trump, the likely GOP nominee for president, added more than $8 trillion to the debt — the most ever piled up in a single presidential term. Trillion dollar deficits have continued under Joe Biden. Neither is a likely voice for fiscal sanity.

But in this case failure isn’t an option. The true day of reckoning is a ways off. But facing it only gets more expensive, and requires more sacrifice, the longer the country waits.

— Chicago Tribune

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