Transcripts

"Commentary"-Helping Hurricane Victims Without Causing A Financial Disaster

SUSIE GHARIB: Tonight`s commentator says it`s important to help the people hurt by the hurricanes along the gulf coast. But he says it`s also important to find financially responsible ways to pay for it. Here`s Charles Schultze, senior fellow at the Brookings Institution.

CHARLES SCHULTZE, SENIOR FELLOW EMERITUS, BROOKINGS INSTITUTION: To help the people of the Gulf coast rebuild their lives and communities, President Bush has outlined what he called "one of the largest reconstruction efforts the world has ever seen". The compassion of our nation indeed demands such a response. But apart from a perfunctory call for cutting unnecessary spending, the president proposes no way to marshal the hundred or more billions of dollars that will be spent, except by borrowing. This has become standard practice. Thus, we have had a series of large deficit-financed tax cuts, which, when made permanent as the president has asked, will add some $4 trillion to the national debt ten years from now. A Medicare drug program was inaugurated with no new source of financing, at a 10-year cost of $400 billion to $500 billion. In Iraq and Afghanistan we are spending more than $80 billion a year and have added that to our borrowing as well. The president and the Congress have become addicted to launching costly national commitments without even thinking about how to pay for them. But our children and grandchildren will pay. Their taxes will pick up the bill when the IOUs come due. And since today`s federal borrowing soaks up funds that could have financed private investment and higher GDP, their incomes will be lower than they otherwise would. It`s a sorry spectacle. I`m Charles Schultz.