THE NEW HOLISTIC RETIREMENT • 11 America can r educe our deficit in several wa ys, so let ’s loo k at the options and their likelihood of addressi ng the COVID-relat ed spending increases. • Reduce Government Spending — The government can reduce its deficit by reducing the amount of money it spends each year. While this sou nds a ppeal ing in theory, in p ract ice it is difficu lt for even the most fiscally committed President to achieve. That’s because the majority of U.S. sp ending is not dependent on new law s or spending bills Congress and the Preside nt c an control. Mandatory government spending—which includes Social Secur ity, Medicar e, Medicaid, and interes t on government debt— is usually more than 60 percent of total gover nment spending each year. 8 What’s more, the national appetite for spending is strong: Today’s voters are asking for more government spending, not less. In summary, C ongress likes to spend money. Americans, by and large, like benefits paid for by government spending. So, a dramatic r eduction in government spending seems, to me, like an unlikely solution to our deficit problem. • Quantitative Easing — The 2008 recession was the first time many Americans ever heard the term “quantitative easi ng.” Essentially , quantitative ea sing is when the government issues bonds to borrow money then buys back those bonds in times 8 Tax Policy Center. May 2020. “Briefing Book: A Citizen’s Guide to the Fascinating (Thoug h Ofte n Complex) Elements of the US Tax System.” hutntcposn:/t/rowllwabwle.taxpolicycenter.org/briefing-book/how-much-spending-
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