Lee HamiltonThe United States government spent nearly $7 trillion in the most recent fiscal year. No matter how you slice it, that’s a lot of money. Most of us would agree the government spends more than it needs to spend. Getting a handle on spending is no easy task, but we need to do it. Of […]
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The United States government spent nearly $7 trillion in the most recent fiscal year. No matter how you slice it, that’s a lot of money. Most of us would agree the government spends more than it needs to spend. Getting a handle on spending is no easy task, but we need to do it.
Of course, spending is only part of the problem. The national debt keeps growing because our elected officials won’t levy the taxes needed to pay for what we spend. President Donald Trump’s so-called One Big Beautiful Bill Act [could] increase deficits by [an estimated] $3.4 trillion over the next 10 years, thanks largely to tax cuts.
One challenge is that America is a big, complicated country with a big, complicated government. The concept of $7 trillion is hard to grasp. The numbers are abstractions; we can’t visualize a trillion dollars. We could cut billions here and there, but the overall impact wouldn’t seem significant.
Another difficulty is that most spending serves a purpose, and much of it is necessary to keep government running effectively. We saw that recently when agencies had to call back employees who had been sent home when Elon Musk’s Department of Government Efficiency (DOGE) slashed the federal workforce. We may not like government, but we rely on much of what it does.
Finally, a great deal of federal spending is off limits for cuts, at least in the short term. Over 20 percent pays for Social Security. Another 13 percent funds Medicare, and 13 percent goes for national defense. Another major cost, Medicaid, provides health care for one in five Americans. When budget hawks target these programs, they often claim they are focused on “waste, fraud and abuse.” But watchdog groups typically fail to turn up significant fraud in government. One person’s waste is another’s lifeline.
Foreign aid is a popular place to cut, but Americans typically think we spend a lot more on aid than we do. In fact, it’s less than 1 percent of the federal budget in most years. And foreign aid isn’t just charity: It’s a key tool for achieving our foreign policy objectives. Importantly, it allows us to be a force for good, easing the effects of hunger and disease around the world.
One area of spending that we should be concerned with is interest on the national debt. For a long time, many economists downplayed its importance, but that has changed as the debt has ballooned. We now spend more on interest than on Medicare or defense.
While tax cuts have helped grow the debt, it’s also true that spending has increased markedly since 2000. The wars in Iraq and Afghanistan were a factor, and so is the aging of the large Baby Boom generation, which increased Social Security and Medicare costs. The COVID-19 pandemic produced vast emergency spending; some of it was temporary but some of it continues.
Donald Trump was right to prioritize controlling government spending, but relying on Musk and his team of outsiders and eliminating entire programs was wrong-headed and doomed to fail. Trump’s insistence on massive tax cuts showed he wasn’t serious about the debt.
Fifty years ago, William Proxmire, a senator from Wisconsin, instituted what he called the Golden Fleece Award to call out wasteful government spending. The projects he cited were often small; the first award, for example, went to an $84,000 study of why people fall in love. But the awards served a purpose. Proxmire’s knack for combining humor and outrage got a lot of media coverage, which focused attention on government spending. And public attention can make a difference.
Ultimately, it will be up to Congress to control spending. It’s the branch of government that’s closest to the people, and the Constitution gives Congress authority over taxes and spending. So all eyes are turning toward the Congress.
Lee Hamilton, 94, is a senior advisor for the Indiana University (IU) Center on Representative Government, distinguished scholar at the IU Hamilton Lugar School of Global and International Studies, and professor of practice at the IU O’Neill School of Public and Environmental Affairs. Hamilton, a Democrat, was a member of the U.S. House of Representatives for 34 years (1965-1999), representing a district in south-central Indiana.
Lee Hamilton, 94, is a senior advisor for the Indiana University (IU) Center on Representative Government, distinguished scholar at the IU Hamilton Lugar School of Global and International Studies, and professor of practice at the IU O’Neill School of Public and Environmental Affairs. Hamilton, a Democrat, was a member of the U.S. House of Representatives for 34 years (1965-1999), representing a district in south-central Indiana.
