U.S. is experiencing robust economic growth

Published 8:36 am Wednesday, July 31, 2019

Over six million new jobs have been created since President Trump was elected. The unemployment rate is the lowest it has been in nearly 50 years, at 3.7 percent. Our country’s gross domestic product (GDP) was projected to be 1.9% over the next 10 years, but thanks in large part to the first major tax reform in 31 years, GDP is now 3.1 percent.
Higher GDP and lower unemployment leads to higher family incomes, more revenues for the federal government, and better jobs.
And this week, President Trump and congressional leadership announced a two year budget agreement that supports our military and benefits Tennessee.
What this new two year agreement does is important.
First, it suspends the debt limit — the amount that the United States can borrow — in order to avoid a global financial crisis.
Second, it raises the defense and non-defense discretionary budget caps — or the amount of money that the appropriations committee can spend on our national defense, our veterans, national laboratories, including Oak Ridge National Laboratory, biomedical research at the National Institutes of Health, and national parks, including the Great Smoky Mountains National Park.
There has been a lot of chest beating about how this budget agreement adds to the deficit, and it is appropriate to be concerned about the deficit.
But, what’s inappropriate is blaming our $22 trillion national debt on funding for our national defense, national parks and national laboratories. The problem is mandatory spending on entitlements, including Social Security, Medicare, and Medicaid.
Discretionary spending — which is the type of spending in this budget agreement — was only 31 percent of all the money the federal government spent in 2018. This type of spending is under control. According to the Congressional Budget Office, discretionary spending has risen at about the rate of inflation the past 10 years, and is projected to continue to rise at about the rate of inflation over the next 10 years.
The real driver of our out-of-control federal debt is mandatory or entitlement spending.
Over the next ten years, mandatory spending, including the interest on the debt, will increase from 69 percent of total federal spending to 78 percent, while discretionary spending will decrease from 31 percent of total federal spending to about 22 percent.
Congress cannot balance the budget with cuts to discretionary spending. We should consider a plan like the Fiscal Sustainability Act, which former Senator Bob Corker and I introduced, to reduce the growth of entitlement spending by nearly $1 trillion over 10 years.
I urged my colleagues this week to support this new two year budget agreement, and to those who are worried about the federal debt as much as I am, I encourage them to remember that our spending problems come from Social Security, Medicare, Medicaid, and entitlements, not national defense, our national parks, and the many other important priorities that are funded in this bill.

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