In October, the Department of the Treasury reported that the U.S. federal deficit for 2013 was $680 billion. The lowest since 2008, it is also the fifth-highest deficit in American history.
According to the Congressional Budget Office (CBO), the deficit was higher than anticipated because of a slow-growing economy and subsequent lack of tax revenues.
While some will celebrate this drop in the federal deficit as a great victory for establishment politics – and claim budget concerns are overstated – reality paints a very different story. Consider two points:
- Even under optimistic projections, CBO expects federal deficits to only shrink for a few years, and then skyrocket for the next several decades. This will lead to a crushing debt burden on the American people.
- A huge part of the deficit’s temporary drop was tax increases – even though America’s debt problems are related to vast overspending, not too-low taxation, as the CBO has reported. Refusal to accept this fact ultimately allows Washington to kick the can down the road on real reforms.
Until Washington gets big spending drivers – such as Medicaid, Social Security, and Medicare – under control, millions of Americans will be faced with a sluggish economy and debt-ridden future.
In short, the 2013 deficit is another failure by both parties to reduce spending and do what’s right for all Americans. Make no mistake: a comparatively lower deficit is a good thing – reducing out-of-control spending should always be seen as a net gain. However, don’t be lulled into giving up the fight because the fiscal situation is less awful than it has been recently. Now is exactly the time when those of us who care about the nation’s finances should fight the hardest.