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Thursday, September 27, 2007
The Debt and The War
The Center for American Progress has done a nice job illustrating data that the National Priorities Project just released on who's bearing the cost of the war. You can check out your state and see how much of the nearly $193 billion supplemental you'll be paying.
But the thing is, for the most part, nobody's paying anything to finance this war just yet. We're just racking up more debt, and that'll have to be paid off from now until eternity.
When the bill comes due, most likely it'll go like this: no politician worth their salt will support a massive progressive tax increase to pay off all the debt generated by the war. So instead, the annual interest paid on the debt will grow, putting more pressure on discretionary programs that typically help working and middle class people. This means either programs will grow slower or be cut. A tax increase could pay for part of it. But unless it's a big and hyper-progressive tax increase, which it probably wouldn't be, President Bush and the Republican Congress will have succeeded in making the middle and lower classes pay for this war.
Another way to look it is how we've been paying for the war: i.e. to a great extent, by borrowing from the Social Security trust fund. By law, the government will have to replace the money it's borrowed. But it's quite plausible that social security solvency will be achieved by payroll tax hikes and benefit reductions, at least in part. When that time comes, let's not forget what we're really paying for.
When Congress proposes to buy kids health care and actually pay for it, or prevent cuts to vital social programs, the President opposes it. Deficit-financed war is a-o-k, though.
Posted by Matt Lewis
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