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other social programs. Spending in
these areas has greatly outpaced
that in other sectors, including na–
tional defense.
lf the proposed comprehensive
national health insurance program
is enacted in coming years, the
prob lem wi l l be further com–
pounded . Proposed federal ly
funded "fu ll employment " pro–
grams along with a suggested ma–
jor urban renewal program would
also add to the increasing burden
of social spending.
In the minds of many Americans,
the record half-tril lion-dollar budget
for 1979 is difficult to reconcile with
President Carter's campaign pledge
to put "highest priority" on fiscal
austerity and to balance the budget
by 1981. lronically, however, the
new half-trill ion-dollar budget is
actually considered to be " con–
servative" and "restrained." lt is
only 8.2 percent higher than fiscal
1978's $462 billion budget. Consid–
ering inflation, the planned increase
for 1979 is a mere two percent in
real terms.
Carter has described his budget
as " lean and tight"-and, in tact,
there are no major new spending
programs included in it, a fact sure
to disappoint many of the liberals
and minority groups who were in–
strumental in electing him. One na-
The
PLAIN TRUTH April 1978
tional newsmagazine even asked in
a headline , "ls $500 Billion
Enough?"
Why, then, another record bud–
get?
President Carter- or any presi–
dent tor that matter-actually has
personal discretion over only a
small portion of the national bud–
get. He is virtual ly locked into
spending increases over which he
has little or no control. These so–
called "uncontrollable" items in the
budget-social security benefit pay–
ments, medicare and medicaid, in–
terest on the national debt, federal
pensions, and so on-today ac–
count for well over three-quarters of
the entire budget. The budget, in ef–
fect, largely grows by itself, and nei–
ther the President nor Congress
appears able or willing to arrest its
growth.
Each year, for example, there are
more people reaching retirement
age and qualifying for social secu–
rity or federal pensions, which are
automatical ly tied to increases in
the cost of living. Also, the number
of people eligible for food stamps,
medicaid, housing subsidies and
other assistance is growing each
year.
American government spending
is literally out of control , and, ironi–
cally, there seems to be little that
can be done about it. lt is as though
Washington has created a Frank–
enstein monster which continues to
devour multiple billions of additional
dollars each year-automatically!
The only way the budget wi ll be–
come balanced by 1981 is by.short–
circuiting the monster: introducing
no major new spending programs,
permitting sorne current ones to in–
crease only nominally, and cutting
out numerous programs altogether.
But politically such " surgery"
can be costly. Congressmen dislike
taking away federal dollars from
constituents-especially in election
years. Belt tightening is simply not
good politics.
So where is all this leading?
lf the government continues te in–
cur large and persistent deficits to
finance spending, inflation wil l con–
tinue unabated. This would clearly
involve risks-risks of eventual run–
away inflation, recession, or worse.
lt would also put America in a worse
trade position in the world, with in–
ternational confidence in the dollar
continuing to sink.
Bringing the budget-and in–
flation-under control, on the other
hand, wou ld also involve sorne
painful readjustments in the econ–
omy, though they might possibly be
less devastating in the long run.
The United States has been on a
spending binge for years. By per–
petuating inflation through per–
sistent overspend i ng. it has
succeeded only in postponing the
day
ot
reckoning.
But the piper will have to be paid!
Just like a person who embarks on
an extended credit card binge, the
U.S. wil l one day have to come tace
to
tace
with the consequences
ot
its
spendthrift ways. Economic disas–
ter scenarios such as those out–
lined in two recent national best–
selling novels,
The Crash of
'79 and
On the Brink,
seem increasingly
plausible.
Will the American people and
their leaders be willing to make the
sacri fices necessary to prevent total
economic catastrophe? The next
few years will tell .
o
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