DEFICITS ARE DESTROYING OUR FUTURE
By CAROLYN LONG BANKS and GREG LASHUTKA

What's wrong with this statement: "I paid for it with a credit card"? If you can see the error, you probably understand why our federal government is so deeply in debt.

Many things can be purchased with a credit card, but nothing is paid for until the money is found to cover the credit card bill. And for the past 30 years in Washington, there has never been enough money to do that. Instead, there have been budget deficits, requiring the Treasury Department to borrow enormous amounts of money - for old bills, new bills and interest on all of that borrowing.

How much? Right now, the federal government is nearly $4.9 trillion in debt and writing new IOUs at a rate of $9,600 per second.

Nearly $4 trillion of that debt has piled up since 1981, when federal deficit spending began to mushroom. The outbreak of World War II in 1941 triggered the growth of our national debt, and it took 40 years (including a few with balanced budgets) to approach a total of $1 trillion. Put another way, over the past 14 years, our nation has piled up $12.50 in new debts for every $1 in debts built up over the preceding 40 years.

Carolyn Long Banks is President of the National League of Cities and Councilwoman-at-Large of Atlanta, Greg Lashutka is NLC First Vice President and Mayor of Columbus, Ohio.

Our spiraling national debt, fueled to an alarming extent by unrestrained entitlement spending, has become a dangerous threat to our nation, our cities and towns, and to people everywhere - especially those who are now growing up with this burden hovering our them.

As leaders in our communities, local elected officials need to recognize this danger and explain it to our citizens. The National League of Cities is preparing a nationwide public awareness campaign in October 1995, that will enable local leaders to play a lead role in this effort. We need your involvement and your support to make it succeed.

To help municipal officials organize and carry out activities to strengthen public understanding about the repercussions of deficits, entitlements and our national debt, NLC will provide resource kits to all cities with populations above 10,000. This campaign is being conducted jointly by the National League of Cities and The Concord Coalition, a bipartisan grassroots organization of private citizens dedicated to deficit reduction and entitlement reform.

Some people may be puzzled about municipal officials getting involved in educating citizens about the urgency to reduce federal deficits and the national

The National Debt is a Large and Growing Obligation for All Americans

September 1995 / Illinois Municipal Review / Page 19

debt? Our agenda should be local, right? And after all, it's a sure bet that any meaningful federal deficit reduction effort is going to mean painful cuts in programs affecting our cities and our citizens.

That is probably true as far as it goes, but there's much more at stake. It is important to understand not only how tough the choices will be, but also how much more difficult things will become if we don't make those choices.

For one thing, the rising national debt is not a free loan. The U.S. government has to borrow money and pay interest - billions of dollars in interest - on that ever-increasing debt. Each year, we are being forced to allocate an increasing proportion of federal resources - the taxes we all pay to Washington - not for productive investments to sustain our national economic strength and well-being, but to pay interest on the national debt.

This year's total interest on the national debt is 10 times greater than the total federal investment in our nation's cities and towns. It exceeds the combined operating budgets of our nation's states. It is one of the fastest growing elements of the federal budget. We need to make some basic changes to reduce federal deficits and make government more effective and accountable. Knowledge about the repercussions of uncontrolled deficits is essential; ignorance and misinformation are poisonous.

Each year, municipal officials in cities and towns throughout America balance their local budgets by making tough choices about what must be done - or done without - and where the money will come from to pay for it. Our national leaders must bring this perspective into our federal budget process as well.

Real change and real deficit reduction will require difficult choices, but those choices will make all the difference for the future of our nation, our cities and our citizens. We can help that process begin if we can help our citizens understand the causes and effects of endless federal deficits and uncontrolled entitlement spending.

This really is our campaign to lead, so let's make something happen.

Page 20 / Illinois Municipal Review / September 1995