Mulvaney: Economy needs an overhaul

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Suggests end to government spending

Christopher Sardelli
It’s going to take a drastic overhaul of government spending to get the national economy back on track, says U.S. Rep. Mick Mulvaney.
For the last three months, Mulvaney, the new representative for the 5th Congressional District, has been busy analyzing the national economy and the government’s budget. Now he’s headed out on the road to discuss the issue with constituents in a series of town hall meetings.
In his first meeting, held at the University of South Carolina at Lancaster on March 24, Mulvaney shared his findings with a presentation titled, “Spending, Debt & Deficits: Government Finance 101.” Speaking to a crowd of at least 100 local residents, Mulvaney highlighted economic problems the country is facing and possible solutions to avert a future economic meltdown.
He said his presentation was about reforming the federal government and finding ways to put Americans back to work, and not about assigning blame to any one group.
“I’m not going to beat up on Democrats, I’m not going to beat up on Republicans, this is largely a nonpartisan thing,” Mulvaney said. “There’s plenty of blame to go around.”
When talking about the national deficit, Mulvaney said it’s difficult to have a conversation about numbers when they are in the trillions of dollars.
Instead, he presented a more relatable scenario, using dollar amounts a regular working family may see.
“Let’s assume we’re a family having a conversation about our budget,” he said.
In his example, he imagined a couple who makes a combined annual take-home salary of $46,000, but spends $78,000 a year. He said then imagine that couple borrows money on their credit cards to get by, and end up having a credit card bill of $281,000.
“That’s where we stand right now,” Mulvaney said about the similar situation the federal government is in.
In fiscal year 2010, the country spent $3.5 trillion and Mulvaney said this is something that can’t continue without risking a financial disaster.
“You don’t survive this type of debt to GDP (gross domestic product) ratio,” he said. “This has been happening for a long, long time and did not sneak up on us.”
The GDP is the market value of all goods and services produced by a country. Differences in the GDP reflect growth or decline in the size of the country’s economy.
Mulvaney also worried about the increase in foreign ownership of the United State’s debt, which rose from 5 percent in 1970 to 47 percent today.
He startled the crowd with a statistic about how much the United States pays China, and said it receives enough interest from our country in one week to buy the equivalent of three fighter jets.
and solutions
So, what is one of the biggest contributors to the country’s deficit?
Mulvaney said contrary to popular belief, it’s not Social Security, but instead the country’s Medicare program.
“Social Security is not the biggest problem,” he said. “Medicare is the problem. In this program, you give the government a little bit of money every week and when you turn 65 you get a credit card basically, an unlimited credit card. And no ones knows the costs on that card.”
To fix the deficit and lower unemployment rates, Mulvaney said tax increases are not the answer. Instead, he said it’s all about cutting government spending.
“It’s because government spending doesn’t create jobs,” he said. “We see that as private investment goes up, unemployment goes down.”
He said it may not be a politically savvy decision, but cutting government spending should be the only choice right now.
“In order to fix things, we have to cut everything,” he said. “And if we cut a program that’s important to you, that doesn’t mean it’s not important to us. It just means we don’t have the money right now.”
But there’s no quick fix for the deficit, he said.
“We’re not going to solve it in a year,” he said. “You could do it this year, but that means everything would have to go down (be cut) by 43 percent. But you wouldn’t be able to get something like that passed.”
The best way to get officials in Washington to cut spending is for regular citizens to become involved in the political process, he said.
“Remember, Washington doesn’t lead, it follows, and we were able to change the culture on earmarks because it came from the ground up,” he said.
“Say what you will about the Tea Party movement, but it got a lot of people involved in the (political) process.
“I don’t care if you are a Democrat or a Republican, go get involved in the process,” he said.

Contact reporter Chris Sardelli at (803) 416-8416