All of which leads inevitably to our current condition. Here’s one measure: In famously bankrupt Greece, the national debt amounts to about $39,000 per Greek. In the United States, federal debt runs to over $53,000 per American. America is now the most indebted nation in the history of the world, a country about to post its fourth consecutive trillion-dollar budget deficit, a place that owes more to creditors than the sum total of its entire economy. We are going under, for real.
And almost nobody in our political system really cares. Sure, some in Congress make the right noises. But at this point there is no sizable constituency for reducing federal spending. By contrast, entitlements are more popular than ever, and most voters favor sending an ever-larger portion of the bill to a relatively tiny group of people. When Obama says we ought to soak the rich, he is speaking for the majority.
Going over the cliff won’t stop this trend, but it might spur a much-needed conversation about the actual cost of government. Nobody wants to see middle class families pay thousands a year more in taxes. On the other hand, that’s money the government has already spent on programs they likely support. It might be useful for them to know that, and to consider the consequences of it. Until they do, there is no hope for spending reform.
There is no question that going over the fiscal cliff would shock the economy, at least in the short run. The Congressional Budget Office estimates that the combination of spending cuts and tax increases would cause real GDP to contract by a full half-percent in 2013, pushing unemployment back over nine percent.
These are bad numbers, but they’re not catastrophic. And they’re likely to be temporary. The CBO found that going over the cliff would in fact strengthen the economy within a year, bringing unemployment down to 5.5 percent by 2018.
Granted, by Washington standards that’s an eternity, which is to say, more than a presidential election cycle away. Republicans could get hammered in the meantime. They might even lose seats in Congress. But at least they’d have the facts on their side.
That’s worth something. No matter what happens in Congress next month, regardless of what Obama tells audiences as he stumps for his plan around the country, the basic equation won’t change: Entities that spend more than they take in eventually go under. That is true for businesses, and ultimately it is true for governments, too, because math is immutable. It’s a species of physics, baked into the fabric of the universe and impervious to election results.
In the long run, math is worth running on. Republicans don’t have a lot of good choices right now. They might as well try it.