A question from Robert Ellman of New York, NY:
What about the investment deficit in the country? Shouldn't the agenda be to reform entitlements and the defense establishment, liberating public funds for those items that only public power can address: infrastructure, education, research & development, human capital, urban problems? Dollars which reach people, like the GI Bill, generate a return which makes the expenditure worthwhile. If we're getting a return on what we spend then running a deficit is not such a bad thing and is even sensible.
Rep. John Sununu responds:
Unfortunately, the federal budget makes no differentiation between capital investments and operating costs. Moreover, as our federal debt has been allowed to grow, the portion of the budget used to cover interest has expanded rapidly. This year, over $240 billion will be spent on interest payments alone. This represents more than we currently spend on education, roads, bridges, the environment, medical research, and all agriculture combined. Finally, federal borrowing crowds out private borrowing and subsequent investment and raises interest rates. The end results are higher costs for college, housing, and other valued investments for families trying to make ends meet.