The debt and deficit blues

Even before the Iran war, the federal budget was already $2 trillion out of balance

Brad Cook

The war in Iran reportedly cost $11 billion in the first 10 days. The invalidating of Mr. Trump’s tariffs could require refunding $133 billion from the treasury. Before either of those events, the federal budget appears to have been $2 trillion out of balance, adding that amount to the national debt.

And now the good news: There are actually people who care about the fiscal condition of the country and are talking about it and how to fix it.

At a recent forum conducted by The Concord Coalition, the organization that has tried for over 30 years to call attention to the debt, sponsored by the Warren B. Rudman Center of UNH Law School and UNH’s Carsey School of Public Policy, speakers focused on the current situation. Carolyn Bourdeaux, the recently appointed executive director of the coalition, and former budget director for the Georgia State Senate and a former Democratic congresswoman, laid out the stark reality.

The current debt is $38.4 trillion, or $112,632 per person in the U.S. That is 100% of the gross domestic product for the first time since World War II, when our country was borrowing to fight a total war. As stated, the debt is growing at $2 trillion per year plus, and is projected to keep increasing at an unsustainable rate.

The federal budget is about $7 trillion in expenditures and $5 trillion-plus in revenue. Of the revenue, corporate taxes are 9%, Social Security taxes 33% and individual income taxes are 51%, with tariffs and other miscellaneous revenue 7% (before the tariffs were held illegal).

Projections are that, over the next 10 years without any changes, the federal government will spend $94.6 trillion and take in $70.2 trillion, adding $24.4 trillion to the debt. Interest on the debt, already the largest item in the budget, will rise from 14% to 19% of expenditures, more than defense, and keeping us from spending on services.

In 2032, the so-called trust fund which supports Social Security will be depleted, and benefits will decrease by 28% across the board for those receiving them. The next year, the trust fund which supports Medicare Hospital Insurance will be empty, with a resulting 11% across the board cut to payments to providers.

The expenditures by the federal government, in addition to interest on the debt, are Social Security (22%), Medicare (14%), other major health care (12%), other “mandatory” spending (11%), defense (13%) and so-called “discretionary spending” (14%) and only the last two are considered adjustable, since the others are mandated benefits.

Every time interest rates increase, the debt payments go up. Each year, the number of people taking Social Security increases, and the relative number of people paying into Social Security reduces. People are living longer than ever. The “Big, Beautiful Bill” tax provisions made the amount corporations pay in taxes go down to record lows and increased the deficit considerably.

Right now, there is no plan to cut the debt, and every year members of Congress propose scores of ways to spend more money it does not have. The American people will end up paying for all this irresponsibility one way or another. There are only two choices: uncontrolled hyperinflation along with economic stagnation; or a controlled process to address the situation.

A controlled situation requires political will, which in the law business we call “a fact not in evidence.” The will requires increasing revenues across all revenue sources, so every sector contributes, along with resisting new spending and cutting spending where it is possible, even when it hurts. Social Security has to be reformed, so those who need it will be guaranteed to get it.

In the budget exercise conducted by the Concord Coalition, participants were able to make choices and get the hypothetical budget under control. However, when asked, all participants said if they had been real members of Congress, they would expect to be defeated in the next election!

Presently, the real members of Congress have several proposals before them to create a fiscal commission (HR 3289), to cut the deficit in half by 2030 (HR 981), and to cut congressional salaries if there is no budget (HR 5755 and SR 88).

U.S. senators elected in 2026, including the New Hampshire successor to retiring Sen. Jeanne Shaheen, will be in office in 2032 and have to deal with the coming crisis in Social Security and the general budget. Candidates in both parties should not be allowed to give vague answers about what they are willing to do to solve the problems, as they will have to do it if it is to be done. Voters must require answers and not let them avoid giving them.

Fixing the debt is not just a slogan; it can be done. Estimates of how to cut the deficit down to 3% or so indicate that the situation would then become manageable over time and possibly allow us to get to a balanced budget, and given reasonable economic growth, the situation would stabilize.

Every citizen should demand it. Our grandchildren require it.

Brad Cook is a Manchester attorney. The views expressed in this column are his own. He can be reached at bradfordcook01@gmail.com.