10.24.2012 1

Obama admits his debt ‘a significant national security concern’

ObamaBy Bill Wilson Our annual trillion dollar deficits are “a significant national security concern because we’ve got to make sure that our economy is strong at home so that we can project military power overseas.”

That was not Mitt Romney at Oct. 22’s foreign policy debate. It was Barack Obama, essentially admitting that the $16 trillion national debt is a threat to national security.

This echoes the warnings of former Chairman of the Joint Chiefs of Staff, Admiral Mike Mullen, who in 2010 had described the debt as the number one danger facing America.

This threat assessment is compelling. If the debt is allowed to grow unrestrained, it will eventually strap the federal government of resources as interest payments rise to the moon. This in turn will limit the U.S. capabilities to manage the global security sphere it has operated since the end of World War II.

Further, if the U.S. were to ever default on the debt, we would find ourselves unable to meet our security commitments around the world, destabilizing whole regions. Surely, that would threaten national security.

And now Barack Obama is admitting it.

Which is funny. Because, if Obama’s own budget proposal were adopted — or even if we change nothing about current baseline spending — the nation will add another $10 trillion to the national debt over the next ten years, rising to $26 trillion.

Obama has already added more than $5.3 trillion to the debt since he took office.

So, by Obama’s own definition, does that make his reelection a “significant national security concern”? Or worse, as Mullen had described, the “single, biggest threat to our national security”? Just asking.

Obama could not possibly take the threat posed by the debt very seriously, or else he’d have proposed some sort of plan to balance the budget. He has never done that.

Romney too echoed Mullen’s assessment that the debt is the number one threat to security. If he really believes it, the proof will be in the pudding should he win. The budget he submits to Congress will either be balanced within a decade or it will not.

To his credit, Romney promised in the debate to “get to a balanced budget within eight to 10 years” if elected.

Which is easier said than done, as Obama has learned, who swore up and down he would cut the deficit in half and never got there. Romney’s proposal to “cut about 5 percent of the discretionary budget excluding military” will only save $30 billion in the first year, not nearly enough.

So, that makes Romney’s plan to reach balance by “reducing spending in a whole series of programs,” including getting rid of Obamacare, paramount to his overall effort.

Either, Romney believes that the growing debt endangers the nation, or he doesn’t. We already know Obama does not. Based on his actions, he appears to believe the federal government has an unlimited capacity to borrow from the Federal Reserve, China, and elsewhere.

Time is already running out. If we attempted to start paying off the national debt today at the current average interest rate of about 3 percent over 30 years, it would cost $817 billion in principal and interest a year out of $2.3 trillion of revenue — a debt to service ratio of about 35 percent.

That might be manageable. But in ten years, if the government’s rosy economic growth projections fall short, and revenues do not rise to the Treasury as anticipated, the national debt may look more like $34 trillion instead of $26 trillion. Then, annual principal and interest owed would rise to an impossible $1.7 trillion.

Once the debt becomes so large that it cannot even be serviced, let alone repaid, the jig is up. Should Romney prevail on Nov. 6, he will have a chance to avert a catastrophic national default, but perhaps just a slim one.

Much depends on not only his budget proposal, but whether the economy turns around. The longer it takes to restore robust economic growth, the deeper the cuts will need to be to get to a balanced budget. Politically, Romney will need to prepare the American people for that possibility.

If he succeeds, then he can maintain political support for even the deepest of austerity programs. But if he fails, or should Obama triumph in Nov., all bets are off.

Bill Wilson is the President of Americans for Limited Government. You can follow Bill on Twitter at @BillWilsonALG.

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