Huge deficits put nation on unsustainable course

Assume for a minute that you earn $22,000 this year and spend $40,000. Next year, you earn $23,000 and spend $37,000. You'd be on the fast track to bankruptcy.

Now add eight more zeros to those numbers, and you get a sense for the federal government's dire financial situation. This year, Washington is on track to spend nearly two dollars for every dollar it takes in. Under President Obama's budget for 2010, the government would spend about three dollars for every two coming in.

Unlike you, of course, the federal government has no credit limit and can print money. And temporary deficit spending is necessary to bail out the financial system and jump-start the economy. In the long run, though, huge deficits are no more sustainable for a government than for a household.

This brings us to Wednesday's start of budget season on Capitol Hill, which featured an underwhelming display of short-term tinkering to whittle down the cost of President Obama's $3.7 trillion spending plan for 2010, coupled with some of the same old backsliding on the long-term problem.

Among other things, the Senate Budget Committee abandoned the useful discipline of laying out budget numbers for the next 10 years, opting instead for a five-year display that conveniently masks the fact that deficits are projected to rise after 2013.

There are limits to how much the government can borrow without consequence — a fact underscored Wednesday when the Treasury had unexpected trouble selling five-year notes to cover Washington's enormous borrowing. It might have been a hiccup, but it roiled the stock market and sent a worrying signal that Treasury might have to offer higher interest rates, which could throw a wrench into the recovery.

Obama has promised to cut the deficit in half by 2013 — a low bar, given its current enormity. Pressed at his news conference Tuesday night, he asked for time and acknowledged that he'll have to make a "whole host of adjustments" in future budgets to bring the red ink under control. We'll see.

Republican critics, meanwhile, call the Obama deficits "unconscionable," but their outrage rings hollow considering that GOP President George W. Bush and a GOP Congress squandered the surpluses they inherited and doubled the national debt.

This isn't an insoluble problem. Everyone knows what has to happen. Democrats have to show spending restraint and make tough choices among competing priorities. Republicans have to overcome their hostility to any and all tax hikes. The economic crisis won't be an excuse to put this off for much longer.