After doing nothing during his first two years in office to deal with the debt tsunami that's clearly visible on the horizon, President Obama delivered a 2012 budget plan that, as Investor's Business Daily accurately reported, "proposed spending $252 billion more in 2012 than the feds spent in 2010 -- at the height of the stimulus spending spree."
Longer run -- and worse than doing nothing -- Obama's projected budgets over the next decade add enough trillions in red ink to double the size of the incoming tsunami.
The federal government's current $14 trillion debt averages out to approximately $50,000 per American, $200,000 for a family of four. For the half of U.S. households paying federal income taxes, that translates to $400,000 per family.
Add the next decade's proposed red ink, and each taxpaying household ends up $800,000 in the hole. That's an unworkable $80,000 a year in interest payments per taxpaying household if the U.S. credit rating drops and lenders require 10 percent interest payments.
Unfortunately, even the $800,000 is based on very rough and overly optimistic guesswork. Politicians projecting out a decade have every incentive to paint a rosy scenario, plus a clear incentive at every election cycle to buy more votes via additional trillions in red ink.
So how do we fix things? Tax hikes to bring in more money? Tax cuts to expand the economy and bring in more federal revenue? Spending cuts? Or some combination of all three?
"Federal spending is growing faster than federal revenues," states an April 28 editorial in The New Republic. "Absent changes in the law, future generations of Americans will likely have to raise taxes to unprecedented levels; dramatically reduce the reach of government programs, risk the macroeconomic consequences of uncontrolled debt, or some combination of …