Federal Spending Climbs Higher into Stratosphere Putting Debt Ceiling in Focus

WASHINGTON, D.C. – Despite all the talk from politicians every election season about getting federal spending under control and tackling our astronomical national debt, the splurge in the Swamp is picking up pace to such a degree that a debt ceiling showdown is expected later this summer. Two years of this profligate spending occurred when both chambers of congress and the White House were under Republican control. Now, with a split congress pitting House Speaker Nancy Pelosi (D-CA) against the Republican Senate and White House, the runaway train may just come off the rails.

One federal department is spending an average of over $100 billion EVERY MONTH. No, it’s not the Department of Defense; it is the Department of Health and Human Services. The department that houses two of the greatest threats to our nation’s fiscal health, Medicare and Medicaid, will spend over $1.2 trillion over the fiscal year. And it is precisely those entitlement programs that are the source of the unsettling budget busters.


“[…] In 2019, the program will cover an estimated 61 million persons (52 million aged and 9 million disabled),” the Congressional Research Service said of Medicare in a report published in May.

“Medicaid is a means-tested entitlement program that finances the delivery of primary and acute medical services as well as long-term services and supports (LTSS) to an estimated 75 million people at a cost to states and the federal government of $616 billion in FY2018,” CRS said in a report published in June.

“CBO also estimates that federal Medicare spending (after deduction of beneficiary premiums and other offsetting receipts) will be about $637 billion in 2019, accounting for about 14% of total federal spending and 3% of GDP,” said CRS.

“Mandatory spending typically accounts for the majority of the HHS budget,” CRS explained in a report published in March.

“Two programs — Medicare and Medicaid — are expected to account for 86% of all estimated HHS spending in FY2019,” it said. […]”

The spending growth is so accelerated that the Treasury Department and the Senate are scrambling to cut a deal to raise the debt ceiling. Republicans are trying to convince Pelosi to open the door to kicking the fiscal can farther down the road in order to avoid a crisis. Democrats, of course, will take advantage of the debt ceiling anxiety to get a budget deal that satisfies them, which means even higher spending.

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How serious is it? The debt limit has already reached earlier this year, forcing the Treasury Department to again take “extraordinary measures” to keep the government from going over the borrowing limit.

From the Hill:

“[…] Lawmakers had hoped they would be able to avoid the politically painful vote to raise the debt ceiling until the fall — and that it could be packaged with other legislation to fund the government and set budget caps on spending.

But that could be much more difficult if Treasury’s ability to prevent the government from going over its borrowing limit ends in mid-September — just days after lawmakers would be set to return from their summer recess. […]

A study released this week by the Bipartisan Policy Center said there was a “significant risk” that the government could reach its debt limit in early September unless Congress raises the cap. The estimate was a shift from its previous forecast, which estimated the debt limit could be reached in October or November, which would give Congress more breathing room.

The earlier timeline comes after Treasury Secretary Steven Mnuchin told Congress in May that the debt ceiling increase could happen in “late summer.” […]”

The House and Senate go into summer recess in a matter of weeks and will not return until after Labor Day, so putting together a deal seems unlikely. Most likely is a sense of Deja Vu all over again, as lawmakers wait until the last minute to craft a deal, raise the debt ceiling and pass bills to spend ever more money.

The Democrats love raising the debt ceiling, but now that they know Republicans are stuck, they will use it as leverage to get what they want. Pelosi likes to denigrate those few principled Republicans that are willing to put their foot down on the debt limit, and instead cut spending to avoid a crisis, but the evidence is clear that establishment Republicans have no issue with racking up more and more debt.

It is tempting to ask oneself, “At what point will they actually get spending under control?” Yet the uncomfortable answer is not until their is a very real and immediate crisis or enough lawmakers with spines to protect the American taxpayer and honor the U.S. Constitution. Unfortunately, the former is much more likely.

So if you hear a faint sound of cash registers dinging in the background this summer, that’s the federal government spending your money, your kids’ money, and your grandkids’ money.

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