The Broken Government Facing Our New President & Congress

A Further Glance at Beyond Zombie Rule

My latest book, Beyond Zombie Rule: Reclaiming Fiscal Sanity in a Broken Congress, is now available in paperback. This note provides another glimpse at the messages in that book and the unavoidable problems confronting the President and Congress in 2025 and beyond.

Although I write a lot about the unsustainable path of the nation’s debt and deficits, good budget policy mainly involves making wise choices with our dollars. After all, the government doesn’t exist to reduce its own deficit. The nation’s unsustainable budgetary path is merely one reflection of a broken government and antiquated tax and social welfare systems for a country that no longer exists.

Take Social Security, for example. Congress enacted Social Security at a time when people generally lived shorter lives and retired later in life. In 1940, the average worker retired at age 68 and had a much shorter life expectancy. If people retired today with the same remaining life expectancy as the 1940 retiree, they would retire at about age 77 on average.

Now, I'm not suggesting that 77 should be the retirement age, but something's got to give. People with average life expectancies are now eligible for old age benefits for about one-third of their adult lives, even as the decline in the birth rate has reduced the number of workers who support each retiree. A couple with an average life expectancy can expect benefits for nearly three decades. You’ve heard a similar story when it is projected that one or another of a couple is likely to live past age 90.

No one can get these numbers to work—more precisely, for the promised benefits to add up to anywhere near the revenues available—as reflected in the near-term exhaustion of the Social Security and Medicare trust funds. Despite this, Congress continues to prioritize increasing retirement benefits, both cash and healthcare, over any other function. It's like we designed a 100-yard dash, ended up in a marathon, and closed the track to all other events.

What about our crazy set of family policies? Social Security was based on a family structure that wasn't even an accurate stereotype for many when benefits were first paid in 1940—a working husband and a stay-at-home wife with children. Today, that structure still provides marriage bonuses by granting add-on spousal and survivor benefits without any additional payment or benefit adjustment by the worker. As a result, it penalizes single individuals and, for reasons I won’t explain here, many married couples where each spouse had roughly the same earnings. In effect, many people are forced to contribute to survivor and spousal benefits for which they are ineligible.

Turn to younger people, and the story is the opposite. When married couples are younger and often have kids living with them, the welfare structure (wage subsidies, food stamps, Medicaid) does just the opposite and provides huge marriage penalties. Even after decades, we have yet to reform this absurd set of family policies that discourages marriage when children are present and rewards it when they are not.

Our absurd set of family policies discourages marriage when children are present and rewards it when they are not.

Or look at our healthcare system. We spend way more on treating chronic and acute conditions than preventing them. It's like we're more interested in mopping up the basement than in preventing its continual flooding.

Don't even get me started on our tax system. It's got more loopholes than a crochet convention. Our tax code (and related commentary), now over 70,000 pages long, is full of special provisions added over the years that unfairly benefit special interests. The result is an inefficient, unfair system susceptible to manipulation by those who can afford clever accountants and lawyers.

Here’s what should be the deal-breaker: We're spending ever more billions to keep clunky old systems running—money that could be better spent on, oh, I don't know, actually helping people or promoting upward mobility. How about orienting resources according to needs, such as those of a working class that has lost faith in government?

In the meantime, we’re in a fiscal mess of epic proportions, and it's getting worse by the day. Our ability to handle economic crises is waning. Even if we manage the debt sustainably, our pre-commitment of all future revenues hinders our ability to adapt to future events.

Still, the bad news, in a way, is good news. These problems are self-imposed. We did this to ourselves, so we are empowered to fix it. The real question is, do we have the political will?

The bad news, in a way, is good news. Because so many of our problems are self-imposed, we have the power to fix them.

With fiscal policies stuck in the past, we cannot adapt well to current and future outside forces or the deadly economic consequences of past policies created by the government itself. We continue to argue about tax provisions and entitlement programs as if it's 1980, despite the world's rapid changes.

We're at a crossroads, folks. We can no longer hope things will sort themselves out but must start building a fiscal foundation to support a strong, prosperous America for generations to come.