Government Watch / Politics

Put It On The Tab, Joe

tab

“Put it on the tab.” It’s a common refrain heard at bars and taverns. It’s done when someone expects to incur lots of charges upfront but will pay for all later, usually the same day. It’s seen as easier than pay as you go or pay by the drink. If you aren’t well known to the bartender or manager, you will likely have to leave your credit card to start a tab (i.e., credit). If you do know either well, your good word and/or past relationship of having “made good” may be enough to be allowed to take part in a spend now, pay later scheme.

The key point about this so-called tab (or bill), however, is it has to get paid. No loaner of money will continue taking part in a scheme where they either did not get paid or even think there is a possibility they might not get paid. Contrast that with our federal government, where Joe Biden and congressional Democrats insist on putting trillions in totally new spending “on the tab.” It’s just more deficit spending. Borrow more now, and someone else, namely future generations, will be responsible for paying it off later. What a scam. At least the drinker is the one who pays his own tab at a bar.

But it’s important to note how bad things are already, even before a dime of new road and bridge infrastructure or even a dime of the so-called human infrastructure, essentially a socialist wish list should get passed. For the fiscal year that just ended on September 30, 2021, the federal deficit was $2.8 trillion. That is the amount spent above what was collected in taxes. It was the second-highest deficit ever, just under the 2020 total. In short, for the fiscal year 2021, $4.0 trillion was collected, and $6.8 trillion was spent, leaving the $2.8 trillion hole. The Bipartisan Policy Center analyzes and tracks the deficit each month, and an easy-to-read analysis is here.

Americans are probably unaware of the fact that we can only afford about 59% of all the federal government we now enjoy if it were strictly “cash only.” With zero borrowing (i.e., no deficit spending), tax revenues of $4.0 trillion would allow for a mere 59% of the $6.8 trillion actually spent in the fiscal year 2021.

What would living within our means, as families must do with their own budgets, and people love to say we should do, really mean? Few would like it. Even deficit hawks who say things like “apply cuts across the board” or “cut everything equally” would be aghast at reality.

Say you work for the federal government as a program administrator, border patrol agent, park ranger, or an Army staff sergeant. Your modest $900 weekly pay ($46,800 annually) becomes $531 as we live within our means. Do you collect the average Social Security benefit of $1,555 per month? Next month’s check (and each thereafter) will now be only $917.

Of course, another application is to cut programs, not pay. Just have 59% of air traffic controllers on duty each day. How would that make the friendly skies? We could keep just 59% of the U.S. military on duty and fire 41%. Border patrol agents, FBI agents, federal corrections officers, federal meat inspectors? Just 59% left. The border, the FBI cases, those prisoners, and much of that beef will just have to be unattended or uninspected. We have to live within our means.

Of course, taxes can be raised or spending cut, but the above points to how difficult that will be. We are decades past cutting waste, fraud, and abuse and getting to a balanced budget. Get rid of foreign aid, you say? That’s a pittance of the federal budget at less than 1%.

Four programs plus interest on the national debt (for all past spending) make up 80 percent of all federal spending. These are Defense/Military, Social Security, Medicare, and Medicaid. These are the four generally considered “untouchable” by members of both political parties. No one wants to disrespect our troops or incur the wrath of veterans or the elderly who benefit from these.

But here’s the awful truth no voter likes to hear, and because no voter wants to hear it, no politician ever says it—even if you don’t touch those, and totally eliminate every single thing the federal government does outside those four areas, you cannot balance the budget. You would still have a deficit. We’d still be putting things on “the tab” for the next generation.

So what can be done? Politicians and the American people are long overdue to have a reckoning about how much government we want AND at the same time can afford? Every program has a constituency, be they seniors, farmers, or college students. If we want the programs for these and other groups, then we must pay for them. If we do not want to pay more, then they must be substantially curtailed, not just trimmed. Consider Medicare. It does not even come close to covering its bills through premiums paid by those enrolled and the payroll taxes collected. Premiums would need to jump substantially, or the services covered slashed significantly. Trimming gets one nowhere.

So there you have it. Balancing the federal budget is an ugly enterprise. It will never be easy. Embarking on a new spending spree for free pre-K and free community college and the like would make balance virtually impossible. [Note: no Biden or Democrat projected future budget shows it in balance.]

It appears we will continue playing the game we have for decades— using 59 cents in taxes and borrowing the other 41 cents for every federal dollar we spend— but for how much longer? All tabs come due. Individuals and countries (China included) who have lent and who continue to do so must believe they will get paid back plus interest. We’re on track to borrow more than 50% for each dollar spent. What happens when no one believes they’ll get paid back? What happens when no one will lend?

Jeff Szymanski works in political communications at AMAC, a senior benefits organization with nearly 2.4 million members. He previously taught high school government and economics for 15 years.


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johnh
7 months ago

Article includes Social Security as one of four programs that take up 80% of budget. Do not agree as SS is a separate sefl funded program & not part of General Fund. I understand that SS fund has a surplus & enough funds to get to 2033-34. Now is time for Congress to increase this payroll tax to fund program beyond 2034. You also mention MEDICARE costs & that come along later during LBJ about 1968 and the payroll taxes is not enough funds to pay out what is currently happening. Medicare taxes need to increase or the MEDICARE benefits will have to be cut. Either way, these programs should be kept separate for General Fund and operate under a budget based on payroll taxes coming in. I suggest keeping a close watch on both parties and actions to these programs. The Millionaires do not care or realize that there is a large group of retirees in America that count on monthly SS benefits as the majority of the income that provides their survival. Do not take SS away from these retirees——

PaulB
7 months ago
Reply to  johnh

Social Security is an unfunded liability. Payments made now to retirees are being funded by those currently working. There is no fund sitting there with your name on it. Your contributions were spent already. Best way to understand it is that it’s a Ponzi scheme system. Disgraceful.

johnh
7 months ago

Just yesterday, President Biden stated that the proposed $1.75T spending bill would cost nothing & not raise Federal Debt. He has said this more than once, and he does not back it up with proof — but must assume he has power to raise taxes on anyone that he wants.

PaulB
7 months ago
Reply to  johnh

He can’t back it up because it’s voodoo math from an imbecile .

Willie
7 months ago

If I were joe Biden I would resign because he will go down in history as the one that destroy America. I promise someone will kill Biden before he is threw.

Rae
7 months ago
Reply to  Willie

That’s not going to happen…as we speak…at taxpayers’ expense…we are going to be paying for a security fence around his private beach house…they have increased his private security…and notice how fat he looks in some of his suits…he has to wear a vest…the administration is just as corrupt as he is…

HocasPocas
7 months ago
Reply to  Rae

Yeah, I heard about this fence around his mansion at tax payers expense. Couldn’t count on a border wall, but he gets his

james michalicek
7 months ago

SCREW BIDEN!!!

HocasPocas
7 months ago

You mean “Let’s go Brandon!”

MariaRose
7 months ago

Making hard choices in finance is a difficult decision. I highly doubt that these politicians pushing all these programs know anything about controlled spending. I, for one, was very surprised to see the COLA raise given Social Security and the small increase to Medicare premium (for those of us who pay that premium for 2022, especially give those dire warnings of the Trust Fund deficits for those programs. What I would like to see happen is a hard look at an attempt to contain spending rather than creating more spending. Start with the current deficit budget and don’t raise it anymore and within that budget total control how the money is already being spent. Evaluate each and every program to eliminate wasteful spending of funds. The biggest example with the most complaints is the pseudo-government funded USPS, with Congress demanded pre-funding of retirement benefits for 75 years ahead (in other words someone born today in 2021 and who gets a job in the USPS is guaranteed a pension plus benefits when they are retire in 2096). Meanwhile the USPS doesn’t charge enough for its services (shipping, postage, fees, etc) to pay this and cover operational costs and payroll of all those postal workers who now need extra time to deliver mail across one citywide area. I only used that example as a show of the efficiency of government workers–the old how many people does it take to screw one light bulb joke–more than necessary. Our lawmakers gave themselves a raise but are doing nothing to control spending and are throwing tantrums like spoiled children because they have to control how much they can spend. They need to ACCEPT the fact that they don’t have infinite funding and deal with it like the rest of us do. They made the Medicaid program problem by using it to fund the “free” healthcare for people who can’t afford the excessively high premiums they allowed the healthcare insurers to charge (after all, who’s putting money into the politicians pockets-insurers, Pharma and Big Pac). I for one would like to see these politicians deal with reality not dreams as dreams don’t pay the bills.

HocasPocas
7 months ago
Reply to  MariaRose

Don’t forget all the money that they give to pay rent and utilities for people that haven’t worked since Covid scare started. Over 8 million dollars in a Pennsylvania county that has a population of a little over 100,000. Wake up America!

Max
7 months ago
Reply to  MariaRose

The USPS, although part of the government, DOES NOT GET ONE CENT FROM THE TAXPAYER’S MONEY. It competes with UPS, FEDEX, etc. just like any other business. There is a Postal Board of Governors that actually controls what the USPS can charge the public for its services. The USPS has to petition the board for changes to be made for it services. The board looks into the request and gets inputs from the other businesses offering the same/similar services. Note, when USPS raises its charges so does everyone else. Whether or not the USPS makes a profit or not, The Congress has mandated the USPS to fund retirement and medical expenses for the ENTIRE US government system, so yes, the USPS is getting screwed. And it is not a free ride! An USPS employee basically gets 1% of their salary for every year that they work, so for 30 years of work, an employee gets 30% of their salary at retirement. Then that retirement gets riddled down by the employee having to pay for life, medical, vision, dental insurances etc. Not all government retirements are the same and everyone does not get the same sugar coating. The big Wigs are getting a lot more than the average employee. Congress for example, does not pay a cent into Social Security and get great retirement and medical benefits at the taxpayer’s expense. I hope you understand.

Allan Brem
7 months ago

We have all but lost our Constitutional Republic while sitting and watching.

Ed Thatpe
7 months ago

It is strange that money is in short supply (even for seniors who have paid into the system all their life!); but there is always money for welfare, free housing, free schooling, etc for illegal immigrants and deadbeats.

Garye
7 months ago

We the People need to demand balanced budgets in EVERY state and the federal government.
These failed politicians are out of touch with reality!
I say take away all their perks,legal costs, massive political staffs and let them earn their pay.
WAY out of control,WAY to long, which is why their disapproval rating is at 90%

MariaRose
7 months ago
Reply to  Garye

Actually better yet, cut their benefits and paychecks by the same percentage they want to increase the budget and see how they deal with it.

D.P.
7 months ago

I have always contended that a balanced budget is a must…..it must be done. it must be binding by law…it must be the first consideration for any new law or resolution. If it cannot be paid for, it cannot be done. This is pretty much how I ran my businesses and personal finances. It was not always easy, but debt was kept at a bare minimum, and never extended beyond the next fiscal year. Budgeting is not that hard when you think about the basics and cut out the fat, pork and special interests….the three things polititians cannot seem to do, precisely because they have skin in the game (lobbys, profiteering, self-intrest and greed and re-election mania). There are plenty of cuts available, including much of the EPA, OSHA, and other “newer” formats of government. Every department can do more to control spending, even DOD, Soc. Sec. and Medicare/Medicaid….where waste, fraud and the like are rampant. People just don’t want to do what is needed…..because of the political costs in their own little kingdoms. It will take serious measures and there just aren’t any serious people in the leadership role …hasn’t been for years. The real term here is not “put it on the tab”…..it’s “kick the can.”
I stand on these three principles…..mandated budget limits, term limits on elected officials, and adherance to the Constitution. Anything else fails in the long term….and our “long term” is running out.

Rosalee Cavanaugh
7 months ago

our tax dollar is building him a wall around his beach house. Why? Parts of the border wall are laying around rusting and it is already paid for. No one cares anymore. Where are the men? American nongovernment builders should go to the border and start building it and then stop the wall around his place. He has no right to use taxpayers money on his personal property. Private enterprises went and save hundreds of people left behind in Afghanistan. Where are our brave men?

Garye
7 months ago

Only wall we should be building for joebama at taxpayers expense should be a jail cell!
Corrupt, traitors needs to be imprisoned.

HocasPocas
7 months ago
Reply to  Garye

Correction, public hanging

HocasPocas
7 months ago

That is our brave men-those people who risked their lives to go rescue people who risked their lives for our country only to be left behind to be murdered by biden and company’s friends in the taliban

Alton R Clark
7 months ago

Why no mention of Welfare, Child Credits, and other things that working people have to pay for, look at the people being fired for not taking the shot, 10, 20, 30, years of unemployment paid in their names and can’t draw a dime of it but people that never worked and raised families on government free money can’t be cut?

David J Sawicki
7 months ago

I say we need a flat tax, everyone has a iron in the fire! 10,11,maybey 12%, that money goes to congress to spend as they see fit, if there is ant left over they can take that as their pay!

Dick
7 months ago

Defense represents less than 4% of the GDP. Even though it is size-able in the government budget, the alternative is to register for Mandarin Language lessons…not a good thing IMHO.

Barb
7 months ago

Do you think Joey from Scranton cares how much his fence will cost? I don’t think so! Sounds like he has those money trees growing out back, just pick off any amount you need at any time, to pay for whatever he and his cohorts want to push at the time for their own wishes.

Betty Davis
7 months ago

I have a problem with this article. Social Security is not supposed to be a part of the government’s budget. Why are you talking about it this way? Funds were collected as we worked, paid by the employee and the employer. It is self supporting as long as funds are not used for other government expenses. Why the need to frighten those of us who paid into the system. Also there were many seniors who passed away before collecting a dime. That was supposed to stay in the fund.

Barb
7 months ago
Reply to  Betty Davis

Betty, for years the government has been robbing Peter to give to Paul. In other words, money from the Social Security fund has been being taken and redirected elsewhere and SPENT! That money you are referring to is gone long ago, and is currently still being redirected and spent. Our government wants to continue to take your money away from you day by day. Your future checks may even be reduced down to 70% of what you are receiving now. Better plan for that day and save now all you can, and not in a bank since your banking will be closely monitored by the IRS if these crazy Bills of the Democrats are passed. Good luck!

Max
7 months ago
Reply to  Barb

Correct on your comment, Congress always put in those one liners that no one bothers to look at or read , so their fingers are always in the money pot, taking but not returning.

johnh
7 months ago
Reply to  Barb

The SS fund money was not taken by govt. but it was borrowed & govt. pays interest on this. Social Security is a separate self-funded program & not part of General Fund. If you remember Trump in 2019 waiving taxes on SS and saying if elected in 2020, then would toll Social Security into General Fund. Just read between those lines.

Carol
7 months ago

Our country is heading for bankruptcy or hyper inflation! Take your pick. Thousands will starve, wealthy will leave and we will end up a third world cesspool with violence running rampant! Then China or Russia will come along and they will become the masters of whomever is left! The masters will take whatever resources they want while Americans will become slaves of those masters! History repeats itself all the time!

BwaHa
7 months ago

Ol’ slow joe’s the equivalent of the drunk Airborne trooper on a furlough in a Hay Street bar in Fayetteville, N.C. He’s breaking the bank and we’ll have to go without until the next payday.

My apologies to my fellow Airborne troopers.

FJB! Let’s Go Brandon!
MAGA2024! TRUMP2024!

Marcella M Covault
7 months ago

CUT the federal bureaucracy by 50% and regulations by 50%. That would just about do it. We are top-heavy in bureaucrats and regulations.

Momcat
7 months ago

Why is it always social security that must take the hit? Why not welfare & other govt handouts that have become a cradle to grave lifestyle instead of the temporary help it was supposed to be. How about ending all welfare programs & giving them back to churches where they used to be & where they belong. Govt can’t do anything cheaper or more efficiently. No mention of ending the big taxpayer payments to planned parenthood. PP has enough money to donate millions to democrats, so they don’t need taxpayer funds. No mention of ending taxpayer funding of undependable green energy? if it can’t support itself, it’s not a viable option. And why no mention of cutting Congress pay? During the lockdowns when you weren’t getting paid, they didn’t miss one dime of their pay or perks. Congress doesn’t need to oversee everything. End most of the onerous regulations, too. It’s a start, but ending the handouts & the over bloated bureacracy should be first.

BwaHa
7 months ago
Reply to  Momcat

TERM LIMITS!

We need them. Once they start realizing they’re going to be limited to the damage they can do the liberals, the politicos will be thinking twice about things. I doubt it will help much but every little bit helps. Limit the damage the politicos in this country can do to us.

FJB! Let’s Go Brandon!
MAGA2024! TRUMP2024!

HocasPocas
7 months ago
Reply to  BwaHa

Eliminate the politicians continued benefits after they are out of office. Go back to work in your community. Nobody would hire the majority of liars and thieves

ajk
7 months ago
Reply to  Momcat

Why don’t Biden, Harris, Pelosi, & their cronies “give up” some of “their” salaries instead of cutting Social Security etc. My parents came here after WW1…did NOT receive WELFARE ETC. FOUND JOBS (most of them, menial jobs) went to school …BECAME CITIZENS!! If you are NOT a CITIZEN, you do NOT belong here permanently…and THE USA IS NOT RESPONSIBLE FOR YOU!

CoNMTX
7 months ago

Send your brain to the lab, Loopy Joe. Put it on the tab.

HocasPocas
7 months ago
Reply to  CoNMTX

Send it to fauci’s beagle and monkey lab. Be sure to do to him what was done to puppies and monkeys

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