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It’s time to talk about the deficit

Nearly $22 trillion dollars. Over $171,000 per household. Over $65,000 a person. That’s the current national debt of the United States of America.

However, despite these shocking numbers, the majority of Americans remain apathetic. As of September 2018, only two percent of people thought the federal deficit was the most important problem facing the country. Furthermore, despite the ballooning debt (the debt is the total amount of money the U.S. government owes to individuals and nations, distinct from the deficit, which is the annual amount that federal government’s expenditures exceed revenues), Congress still approved a 2018-19 federal budget that will add an additional $985 billion to the nearly $22 trillion total.

What is perhaps even more appalling than this general apathy among both politicians and Americans alike is ignorance regarding this issue among youth that is endemic across the United States. After all, the compounding debt, although already terrifying, will have the most tangible consequences for those, like me, who are currently in their late teens and early twenties. It is our social security, our welfare programs, our military and our healthcare programs that will get short-changed as the federal government works to balance the budget around the rising interest payments owed to the nations that are currently buying our debt.

How does an issue with such serious implications for the future balance of the U.S. budget inspire such little interest? Ultimately, there are two central characteristics that make the federal debt ill-suited for political attention. For one, the U.S. debt has become so severe that it is unlikely to be erased in either my lifetime or the lifetime of my children or grandchildren. Even the deficit will require several budget cycles to eradicate. Secondly, discussion of the debt lacks political interest; it is hard to craft an inspiring, optimistic stump speech about how the federal government is hemorrhaging cash at a rate of billions of dollars a year. Suggesting that the only way to fix the problem is to cut back on expansive, innovative reform programs would likely be even less popular among American citizens.

Politics, after all, is all about sex appeal. Admittedly, this might be hard to believe given the popularity of Bernie Sanders’ disheveled hair and Ted Cruz’s rambling Senate-floor speeches. Although sex does not appear in the halls of the Capitol, it appears in the headlines. They crave these blocks of words that, plastered across television, laptop and phones alike, announce political victories and failures. Politicians seek these national headlines that bring them attention and praise, advancing their careers.

Although these debt and deficit headlines do make it onto the homepages of political news websites occasionally, they tend to simply describe the problem: the fact that the deficit is growing. Any potential policy solutions are barely covered. After all, no one wants to be the wet blanket announcing the need to both raise taxes and cut spending.

However, despite its lack of immediate sex-appeal, the issue of the federal deficit matters. A high deficit means that more investors are needed to buy the U.S. debt. Since investors have a finite amount of resources to invest, if more buy debt, fewer will make private investments that create jobs, spur innovation and increase market growth. Because of this, some estimates claim that the continuation of the current levels of fiscal irresponsibility would result in the equivalent of two lost decades of growth.

Furthermore, as the U.S. sells more debt, its interest payments will rise. These interest payments have already increased to such an extent that the Congressional Budget Office (CBO) projects that annual interest payments alone will exceed discretionary spending (federal spending on non-entitlement programs or spending the government can vary from year-to-year) on all nonmilitary items over 10 years.

When suppressed growth and rising interest payments force the U.S. to severely cut its budget, the government will likely look to discretionary options first, such as cutting back on investments like infrastructure. In turn, essential components of the American economy, such as roads and bridges, will wear until the U.S. regains its fiscal footing, negatively impacting the growth of industry as well as quality of life for years to come.  

Ultimately, however, even if discretionary spending is cut significantly, it still does not represent not enough of the budget to offset the deficit or even make a dent in the debt. As a result, entitlement spending, including Medicare, Medicaid and social security payments, will likely be cut and taxes will likely rise, dramatically impacting the amount of available income in the economy, further suppressing growth and harming the quality of life of most American citizens.

These are the plethora of consequences to which our generation can look forward to. The question becomes: How do we take these consequences, which are real and tangible, and communicate them in a way that can make young Americans realize the immediacy of the issue? This task of communication is not impossible; it has been done before with climate change and, for that matter, with the federal deficit.

Climate change is, at this point, irreversible. Although we can still lessen the overall harm of climate change, we are unable to stop its progression. Furthermore, the topic necessitates understanding scientific topics that, although fascinating to some, do not necessarily package well into a political speech. Regardless, recent studies have shown that young voters are more likely to care about environmental issues than other age and demographic groups. In fact, millennials are twice as likely as other voters to care deeply about the environment. Sixty-seven percent of millenials think protecting the environment should be a top priority, and 60 percent disapprove of Trump’s environmental policies.

At one point in history, the federal deficit was a frequently mentioned part of political discourse due almost entirely to Ross Perot. Perot made the issue a centerpiece of his 1992 campaign for president before exiting the race. He was famous for his graphs and posters demonstrating the severity of the issue.

Today, we need someone like Perot, someone who can engage the American public with this issue. It is unlikely that any nominee from a major party would be willing to do this. Thus, instead, some are looking to former Mayor of New York City Michael Bloomberg, who successfully turned New York City’s $5 billion dollar deficit into a $4 billion surplus by raising property taxes, to be the independent candidate who does exactly this in 2020. He, after all, once ran for mayor as an independent and won.

However, we cannot just, as a society and as youth, wait and hope he does run. It is our future. It is on us to do something. It is on us to start caring, even if the issue does not make it into stump speeches or provide perfect material for comedy sketches or memes. Because if we care (and we vote), politicians will start to care too.

 

Contact Claire Dinshaw at cdinshaw ‘at’ stanford.edu.

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Claire Dinshaw

Claire Dinshaw

Although currently undeclared, Claire Dinshaw is currently exploring a major in the areas of economics and political science. Dinshaw is specifically interested in political issues related to income inequality, criminal justice reform and women’s rights and hopes to ultimately pursue a career in the area of law or public policy. In addition to her work with The Daily, Dinshaw is involved in Stanford in Government.