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Shelby Says That Entitlements are Driving the Debt

Brandon Moseley

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By Brandon Moseley
Alabama Political Reporter

On Friday, U.S. Senator Richard Shelby (R) from Alabama addressed the Senate Appropriations Committee and told the Committee that the federal government has a spending problem and entitlements are what is driving the debt crisis.

Sen. Shelby said, “Today, we will hear from our witnesses on the impacts of the sequester, which is appropriate and timely because the cuts are poised to take effect in just 15 days. It should be noted, however, that the sequester is something that the Congress and the President set in motion, knowing full well that this day could come.”

Sen. Shelby continued, “The sequester will bring spending cuts that are automatic and across-the-board for most discretionary accounts. A rigid formula will determine how cuts are made, instead of what’s best for economic growth, safety and prosperity. Cuts will happen without regard to a program’s merit or efficacy. Some of the most severe cuts will hit defense programs.  Although we must reduce spending, it should be done in a deliberate way. This is why I opposed the bill that created the sequester in the first place. The sequester was supposed to be a last resort if the so-called Super Committee failed to agree upon measures to reduce the deficit. In the end, the Super Committee reached an impasse. It did not produce even a penny of deficit reductions.  It’s been over one year since the Super Committee’s failure. Although we have seen the sequester coming, we haven’t taken any steps to fix it. In fact, Congress has only delayed it further. This situation presents a perfect opportunity for the President to exercise some leadership. Although he has called on Congress to act, he has not put forward a proposal of his own with specific options.”

Sen. Shelby said, “Government spending remains high during the next decade and is expected to grow beyond its 40-year average. This will occur even with the discretionary spending caps and sequester put in place by the Budget Control Act. In fact, under current law, CBO estimates that discretionary spending will fall by more than 3 percentage points below its historical average.  The real driver of our debt is not discretionary spending, but entitlement spending. As CBO reports, the combination of an aging population, rising health care costs, and an expansion of health insurance subsidies will drive up the cost of mandatory programs. Absent reform of entitlements, this will lead to an unstoppable debt spiral.  The issue is only compounded by the cost of servicing our debt, which will rise from about $220 billion in 2012 to over $850 billion in 2023. By then, interest payments will equal 60 percent of our discretionary budget. This growing indebtedness, as CBO states, poses “an increased risk of precipitating a fiscal crisis.”
Sen. Shelby warned, “The warning signs that we are moving towards a fiscal meltdown have been in place for some time. Unfortunately, Congress has repeatedly failed to heed these signs. It has been years since Congress has even had a regular-order budget process with appropriations measures agreed upon by both Chambers. Instead, important decisions on spending and taxes happen at the eleventh hour behind closed doors. The American public deserves a transparent and accountable budget process that restores fiscal order. “Sequestration should not be a part of the process. It certainly is no long-term solution to our spending problem. But, it should be a cautionary tale for Congress. The sequester we face today is the tip of the iceberg compared to the austerity measures that will be necessary in the future if Congress does not act soon on comprehensive fiscal reform. Comprehensive reform must include both tax reform and spending cuts. One without the other is only a partial solution.”  “Today, we will hear about the dire consequences of the impending cuts. I do not doubt that they will be painful to bear for many agencies across the federal government. If there is a way to mitigate the pain while we continue to enforce fiscal discipline, I am open to discussing it. But, I believe that it is important to reemphasize that the sequester and whatever temporary solution we may devise is just a precursor to the main event.”

The national debt is $16,532 billion according to the website www.usdebtclock.org.  The largest item in the budget is Medicare and Medicaid which is costing taxpayers $810 billion a year (equal to 77% of the deficit).  Social Security is next at $774 billion.  The federal government also spends $353 billion on other income security programs.  If these entitlements continue to increase they will quickly absorb any cuts from Defense and non-defense discretionary federal programs.

Senator Richard Shelby is Alabama’s longest serving member of Congress.  He was elected  to the Senate in 1986 as a Democrat.  He served 8 years in the U.S. House of Representatives prior to that.  He was an Alabama State Senator from 1970 to 1978.  The conservative Senator switched to the Republican Party in 1994.  He is the fourth oldest member of the Senate and is the12th most in seniority.

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