AFP Arizona Statement
Scottsdale Recess Rally
August 22, 2009

Rep. Harry Mitchell has sometimes cast fiscally conservative votes, in the best tradition of the Democratic Blue Dog Coalition. Earlier this year, Mithcell voted against the pork-filled omnibus appropriations bill, which proposed to increase ongoing federal programs by 9 percent at a time when the federal government is already borrowing gigantic sums of money. Mitchell also voted for Rep. Jeff Flake’s resolution asking the House Ethics Committee to study the relationship between earmarks and campaign contributions.

In the past, Blue Dogs have been candid in warning Americans about the country’s very troubling long-term fiscal outlook. In doing so, they have deserved a lot of credit for attempting to address the long-term fiscal disaster facing our children and grandchildren.

Speaking of which... The Congressional Budget Office estimates that the House health care bill, HR 3200, would cost over $2 trillion in its first 13 years. The Blue Dogs did shave over $100 billion off the price tag, but that’s a drop in the bucket. According to the Cato Institute:

Taking an even longer view, we calculate that [HR 3200’s] permanent program would add $13.6 trillion to the federal government’s total unfunded obligations in today’s dollars. That is, the government would need to have that amount in the bank today, invested at interest, to fully finance the new program’s subsidy costs as they come due. Social Security and Medicare actuaries estimate that these two programs’ unfunded obligations under today’s policies exceed $100 trillion (not billion) in today’s dollars…

Cato also points out, “[The $13.6 trillion] estimate optimistically assumes that health-care costs will eventually grow with the general inflation rate (they’re currently growing much faster).

The $100 trillion figure does not include anything else on which people might want to spend taxpayer money: national defense, courts, interstate freeways, etc. $100 trillion is roughly seven times the entire current yearly output of the US economy, or over one million dollars for every American under the age of 18. Covering that gap would require doubling the portion of the economy taken in federal taxation. With massive new taxes and/or with massive borrowing crowding out private investment, there will be fewer resources for the long-term capital formation needed to sustain future productivity. With endless debt, higher taxes, and inflation on the horizon, Americans will continue to save money at dangerously low levels. If we do not change course, the result will be stagnating economic growth—or worse, capital consumption and economic decline.

To protect our children and grandchildren, Rep. Mitchell and his Blue Dog colleagues need to fight hard to table HR 3200 and point Congress toward fiscally sustainable alternatives.