Big Government, Budget, Donald Trump, Issues

3 Things Trump Can Do to Control the National Debt

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Photo: Benoît Prieur (Agamitsudo) – CC-BY-SA

Photo: Benoît Prieur (Agamitsudo) – CC-BY-SA

When President-elect Donald Trump enters office on Jan. 20, he will inherit almost $20 trillion of national debt. This debt is a threat to the American economy, and its key driver—unsustainable spending—must be controlled.

Come Jan. 20, the new administration should act immediately to tame the federal budget and reduce the national debt. Here are three solutions from The Heritage Foundation’s Blueprint Series that do just that.

1. Reform autopilot entitlement programs.

Entitlement programs like Medicare, Medicaid, and Social Security make up the largest portion of the federal budget. In 2015, major entitlement programs consumed 52 percent of all tax dollars. They will grow to consume even more of the budget unless lawmakers intervene.

Currently, entitlement programs run on autopilot, meaning they don’t require new spending bills to keep running. Because of laws put in place years ago, agencies spend whatever is necessary each year to fund these programs, and it is politically unpopular for politicians to reform or downsize them.

The next administration should reform these unsustainable mandatory programs. Some commonsense solutions include repealing and replacing Obamacare, modernizing Medicare, capping the federal allotment for Medicaid, and making reforms to Social Security.

Entitlements Devour All Taxes by 2038

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2. Balance the budget.

Persistent budget deficits allow the national debt to spiral out of control. For the last 50 years, the federal budget had an average deficit of 2.8 percent of gross domestic product, and the current Congressional Budget Office baseline projects that deficits will surpass $1 trillion before the end of the decade.

Balancing the budget isn’t a cure all, since legislators can always use higher taxes to support higher spending and technically balance the budget in the short term. In the long run, higher taxes would end up chasing ever higher spending, which is unsustainable. Instead, a balanced budget is an important goal to prioritize spending and reduce deficits and debt.

The incoming administration should adopt a plan that balances the budget while reducing spending and taxes. The Heritage Foundation’s “Blueprint for Balance” balances the budget in six years and creates a surplus in seven years.

How to Balance the Budget

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3. Reform the budget process.

The current budget process is broken. The budget process is supposed to enable lawmakers to set national priorities in a timely and predictable way. But the current process, established in 1974, has only worked four times.

The current process leads to higher government spending and debt. Since the most expensive programs, like Social Security, Medicare, and Medicaid grow on autopilot, and because they are also the most popular, politicians have little incentive to change them.

The next administration must enact budget process reforms that restore accountability and fiscal responsibility to the federal budget.

Commonsense budget process reforms such as fair value accounting, including interest in estimating the impact of congressional budget proposals, and statutory spending caps that limit spending growth enforced by sequestration, will help reform the budget process and get national debt under control.

How the Budget Has Changed

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So far, the new administration’s plans for addressing the national debt haven’t been great. Trump has proposed renegotiating the national debt and printing more money. Both are possible, but will ultimately prove to be unhelpful and economically dangerous distractions from the out-of-control spending that is driving the national debt.

Despite the lack of concrete current plans to control the debt, the next administration will have ample opportunity to tame the federal budget. Trump’s pick for Office of Management and Budget director, Rep. Mick Mulvaney, R-S.C., is a budget hawk who values fiscal conservatism.

The Congress is controlled by Republicans who have put forth sensible and realistic proposals to reduce out-of-control health spending with Medicare premium support and caps on federal Medicaid allotments. With the House, Senate, and executive all controlled by the same party, serious budget reform is within reach.

The incoming administration needs a plan to get spending and high national debt under control now, to ensure economic freedom and secure prosperity for Americans in the future.

Commentary by Mollie McNeill, the Daily Signal

  • jerry1944

    the first thing he could do is break the fingers of those dem Rep that write the checks . The fought so hard to stop obambo they couldnt wait to do what he said with OUR tax dollars both bonehead then ryan but both are them are more dem that Rep i think

    • James Andrews

      Ryan;s been terrible with the overspending; we need to lose him!

  • Ithamar

    How are you going to reform Medicare, Medicaid, Social Security and the numerous other social welfare programs when our gov imports 100,000 “refugees”, 50,000 “asylum” seekers, and 40,000 “unaccompanied minors” per year from Asia, Africa, the Middle East, and South America placing all of them into these programs subsisting on the dole at taxpayer expense? This does not include the hundreds of thousands of Mexican/Central American illegal aliens on welfare. Shut off the spigot and repatriate these masses of no loads or we are done fore as an independent people.

  • James Andrews

    He should absolutely veto any overspending/deficit adding bills period! If Congress sends him any bills that are not fully funded (they cannot add anything to the debt), then he should veto them, period. No more debt spending, just for starters. Outlaw ALL earmark/pork barrel spending as well!

    • daves

      The repeal of Obamacare is not funded and will add to the deficit. Should he veto it?

      • James Andrews

        Bull; the government does not belong in health care, period, outside of Medicare for retirees. Get rid of it entirely; neither the taxpayers, nor those of us who pay our full insurance, should be burdened by having to pay for the “subsidies” of those on Owebamacare.

        • daves

          So you’re not really all that concerned about the debt.

          • James Andrews

            I’m very concerned about the debt. You missed my point entirely. Health care is NOT a right, but a service that has to be paid for. If someone can’t pay for it, then they should not have access to it. Second; if the doctor or hospital wants to give out some charity care, that is fine, but they should absorb the cost, NOT those of us who pay taxes and work, and oay for our full insurances. Government needs to get OUT of health care; they cannot make anything more “affordable” as they are way too corrupt.

          • daves

            WASHINGTON (Reuters) – U.S. President-elect Donald Trump aims to replace Obamacare with a plan that would envisage “insurance for everybody,” he said in an interview with the Washington Post published on Sunday night.

            Trump did not give the newspaper specifics about his proposals to replace Democratic President Barack Obama’s signature health care law, but said the plan was nearly finished and he was ready to unveil it alongside the leaders of the Republican-controlled Congress. The Republican president-elect takes office on Friday.

            “It’s very much formulated down to the final strokes. We haven’t put it in quite yet but we’re going to be doing it soon,” Trump told the Post, adding he was waiting for his nominee for health and human services secretary, Tom Price, to be confirmed.

            The plan, he said, would include “lower numbers, much lower deductibles,” without elaborating.

            “We’re going to have insurance for everybody,” Trump said. “There was a philosophy in some circles that if you can’t pay for it, you don’t get it. That’s not going to happen with us.”

          • James Andrews

            Not disagreeing with you about what Trump said. But I do not agree with him; it should not be replaced at all; Health care costs will never ever come down, as long as Big Brother is this “involved:”. They can’t manage a paper bag full of money as it is, and we are twenty trillion dollars in the hole. They have already bankrupted us and our children’s future! So how can anyone with half a brain think that they can “solve” a problem, which they themselves are 90% responsible for creating in the first place, along with the surplus of ambulance chasing lawyers!

      • James Andrews

        It doesn’t have to be “funded” period; let the insurance companies make the appropriate adjustments, and then pass the saving back onto us who actually pay for the full insurance, and have been getting screwed by this terrible legislation. We need to get government out of health care, not more involved.

        • daves

          When you repeal a tax increase odds are pretty good you’re going to increase the debt.

          • James Andrews

            That’s why we must fight to seriously downsize the Federal government, and pass legislation that forbids deficit spending, period. We also need to downsize some state governments, like the corrupt ones of California, New York New Jersey, Conn., Maryland, etc. Until this is accomplished, the working class (what is left of it) and especially the private sector, does not stand a chance of long term survival.

          • daves

            Okay but that’s not going to fix the debt increase caused by repealing Obamacare.

          • James Andrews

            You still don’t get it; the taxpayers, nor those of us who pay for health insurance and health are, should be responsible for paying for those who do NOT pay their fair share, which is what has ben forced upon us even more with the ACA. We need to force Big brother OUT of health care, if it ever going to become truly more affordable.

          • daves

            Shouldn’t they at least keep the taxes in order to avoid increasing the debt?

          • James Andrews

            Maybe, just for now. But the Democrats are the ones responsible for this terrible legislation and also the massive increases we have seen in health insurance costs over the past few years. Let THEM pay for that debt out of their OWN pockets and PACS. The rest of us don’t want any part of it, and we shouldn’t be punished for their terrible mistakes, which we are.

    • PrahaPartizan

      You know that the Congress could just as easily erase the deficit by raising income taxes on corporations and the uber-wealthy as by cutting spending on programs which rely on regressive tax policy like the FICA. There is nothing written in stone or any other material which says that taxes cannot be increased, as they should on those who have manipulated the system over the past 40 years to reduce their tax obligation while increasing their consumption of the services the government does provide, like security and the courts. Besides, it all depends on just which programs any particular person wants to see slashed. How about we start with cutting DoD spending — bigly. After 12 years of wasting money on the global war on terror and cybersecurity, which even conservatives are claiming haven’t been realized successfully, why waste any more money on those efforts. Isn’t that the conservative cant, if something doesn’t work we’ll just stop funding it until we maybe come up with an idea from our empty heads?

      • James Andrews

        We have the second highest corporate tax rate in the world. In case you haven’t been paying attention(which is obvious), American businesses have been leaving the U.S. in droves over the past twenty years! Raising taxes on them will only chase even more of them, and the wealth,out of the U.S. We need cyber security, as things have been getting bad with the hacking thing. But the private sector will do a better job with new technologies to fight this then will Big Brother.

        • PrahaPartizan

          We might have the second highest nominal corporate tax rate in the world, but the effective rate US corporations actually pay places them well in the middle of the pack. Those US corporations haven’t been leaving because of the high tax rates so much as they are racing to the bottom to see just how little they have to pay YOU. Corporations haven’t paid for the benefits they receive from this nation ins a long, long time, along with the 1%-ers who own them. The paymaster will be coming to collect soon. Oh, as for your claim that the private sector does a better job with new technologies, are you referring to all of those new technologies which would not exist but the investment the government makes in basic and application research each and every day? Bet you forgot about those — if you ever knew. Go back to reading your holy book based on events two millennia ago.

          • James Andrews

            Blah blah blah…..our tax dollars should NEVER be used for “research”. That is for the private sector to do. Stop sticking up for the most financially corrupt government the world has ever seen in the past five hundred years, at least. What part of twenty TRILLION dollars in the hole do you NOT understand? The last thing the nation needs is higher taxes, including on businesses/ corporations; we need to seriously downsize the grossly over bloated Federal machine.

  • daves

    Social Security and Medicare are funded. Don’t cut benefits to pay off irresponsible spending.

    • BonLovesFreedom

      daves ~ Are you actually admitting dinglebarry engaged in irresponsible spending? (He spent more than ALL presidents combined in the history of America.)

    • James Andrews

      I agree on that one, though I don’t agree on including non retirees into Medicare, as a way of “expanding” health care. It should be what it was originally intended for; to help retirees and the elderly, period.

  • Cora Bird

    Social Security and Medicare are programs the American people were compelled to contribute to. People who DID NOT contribute need to be removed immediately. I expect my Social Security and Medicare benefits to be available to me when I need them, after all, I paid for them.

  • Jake Mehoff

    There are 13, maybe more, nutrition programs yet we hear that a large amount of children go to bed hungry every night. How can this be ? No one should go hungry in this country. I go to the market and observe young women getting free baby formula via WIC yet their arms are resplendent with tattoos. Tattoo parlors charge a minimum of $ 50.00 per hour for their services. This is just one of many govt. programs that are out of control. Review all these programs and use logic to determine their efficacy.

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