Health Care Will Bankrupt America
Senate Majority Leader Mitch McConnell announced on Tuesday that Congress will vote this week on a repeal of the Patient Protection and Affordable Care Act. The Republican Party has spent the last seven years campaigning to repeal this act (also known as Obamacare), but now their efforts to fulfill this promise are on the verge of collapse.
With at least three Republican senators pledging to oppose this repeal, it appears the Patient Protection and Affordable Care Act will remain the law of the land for the foreseeable future.
This is a catastrophe of nation-destroying proportions.
The federal government already spends 5.5 percent of the nation’s gross domestic product on health care. According to the Congressional Budget Office, this spending will increase to 9.2 percent of gdp within 30 years. Such a spending increase will require a $9,450 permanent tax increase per household, unless the government slashes trillions of dollars of spending from some other major department, like the Department of Defense.
Yet defense spending is already projected to fall from 4.7 to 2.7 percent of gdp within a decade. Therefore, any major cuts to the U.S. military could leave its budget on par with that of the European Union.
Taxing the rich is not a solution either. Even if the government confiscates all income earned beyond $1 million, it will raise only 75 percent of the funds needed to finance the current government health-care system. That calculation does not factor in the massive loss of incentive to generate income that those millionaires will experience if taxes go that high. According to economist Brian Riedl, a senior fellow at the Manhattan Institute: “At most, an additional 1 percent of gdp could be extracted before exorbitant marginal tax rates begin changing taxpayer behavior, harming the economy, and costing revenue.”
Democratic socialist Sen. Bernie Sanders has an alternative. If adopted, his single-payer health-care plan will add $32 trillion in new costs over the next decade, according to the Tax Policy Center. That is 16 times more expensive than Obamacare. So it is not an economically feasible solution either.
Unless Medicare is reformed and the Affordable Care Act is repealed, the U.S. government will have to borrow even more exorbitant sums of money than it has been doing so far. The Congressional Budget Office estimates that the national debt will soar to an incomprehensible $92 trillion over the next 30 years. That means 60 to 100 percent of all individual income taxes will go toward paying the interest of this debt, depending on interest rates in 2047. Since roughly half of all federal revenue comes from individual income taxes, this leaves little money for running a country.
Financial historian Niall Ferguson has warned that nations and empires usually fall apart when the costs of servicing their debts exceeds the cost of defending their borders. Specifically, he has warned that the U.S. could experience a dramatic collapse when it reaches this point, just as was experienced by the Roman Empire and Soviet Union.
Based on current budget projections, out-of-control health-care spending is pushing America toward bankruptcy and economic collapse. If interest rates rise faster than expected, America could soon be spending trillions of dollars per year on interest and struggling to finance both an army and a welfare state.
The Bible says a “good man leaves an inheritance to his children’s children” (Proverbs 13:22). Yet in order to enjoy an easier life right now, Americans today are leaving their “children’s children” with a $92 trillion debt.