10/20/04 — Concord Coalition seeks constituency for balanced budgets

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Concord Coalition seeks constituency for balanced budgets

By Don McLoud
Published in News on October 20, 2004 2:01 PM

The federal budget deficit is reaching record levels, baby boomers will soon be retiring leading to Social Security debt and neither political party is addressing the problem.

That's the distressing, and lonely, message of one nonprofit group that is trying to bring fiscal responsibility to a city better known for pleasing the folks back home with pork-barrel spending.

The bipartisan Concord Coalition brought its call for a need to balance the federal budget Tuesday to the Goldsboro Rotary Club.

"No one party takes all the blame or the credit," said Phil Smith, the coalition's national grassroots director. "It's a bipartisan problem."

For 12 years, the coalition, which was formed by a Republican senator and a Democrat senator, has been the cry in the wilderness that chronic budget deficits could lead to crisis, especially as the population continues to age.

Now those baby boomers are nearing retirement, and the money the politicians have been raiding from the Social Security trust to balance the budget will be coming due in another 14 years, the coalition estimates.

"It's no longer a problem way off in the future," Smith said.

But it's a problem that few people want to listen to today.

"There's a natural constituency for more spending," Smith explained. "There's a natural constituency for tax cuts. But it's hard to find a natural constituency for fiscal responsibility."

One cause for concern is the number of workers paying into the Social Security system per retiree.

In 1960, there were five workers per one retiree.

In 2002, there were three workers per retiree.

And in 2040, there will be only two workers per retiree.

"You cannot have a major ratio shift like this and do nothing," Smith said. "But that's exactly what the United States government is doing right now."

Smith gave a percentage breakdown of where federal tax money goes:

*Social Security -- 22 percent.

*Defense -- 19 percent.

*Domestic spending (includes pork-barrel spending) -- 17 percent.

*Medicare -- 13 percent.

*Other mandatory spending -- 12 percent.

*Medicaid -- 8 percent.

*Interest on the debt -- 7 percent. This item will likely grow, he said, as interest rates continue to climb.

*International aid -- 1 percent. Smith pointed out that this is a much smaller number than many people realize. He said he often hears at coalition public meetings that all we need to do is cut foreign aid.

*Homeland Security -- 1 percent.

Smith noted that, so far, neither presidential candidate's plan for balancing the budget includes the war in Iraq.

Smith added that he is often asked at coalition meetings whether the country has reached a record deficit.

Smith said the country is "nearing a record deficit," but added, "Why do we need to wait before we have a record deficit?"