ANNAPOLIS. — Annapolis.-- We Americans would laugh at a primitive culture whose citizens threw a large part of their nation's wealth into a yawning pit to satisfy an insatiable, mythical monster.
But our nation is doing the very same thing, day in and day out, throwing 17 percent of our hard-earned federal tax dollars into the black hole of interest payments on a federal debt of more than $3 trillion. Unfortunately, our monster is not a myth, and if we don't slay it soon, it will devour us. The problem is that no one has enough ammunition, enough courage and enough authority to do the job.
Each year, we pay hundreds of billions of dollars just in interest on a debt expected to hit $5 trillion by 1995. Soon, Americans will spend more on interest on the debt than on any other component of the federal budget, including defense.
The numbers may be incomprehensible but the cost to the American people -- and to state and local governments -- is painfully clear. Take the interest on this year's $318 billion deficit and just ask yourself: How many affordable homes could that money finance? How many children could it educate? How many polluted waterways could it clean up?
Financially, the states are barely keeping their heads above water. But instead of throwing us a lifeline, Uncle Sam has tossed us a bag of bricks. Federal revenues for major programs have dropped or stagnated in actual dollars, without even considering the effects of inflation. In Maryland, federal aid to higher education fell from $92 million to $3 million over the last eight years; in just a year federal funds to the state highway administration dropped $101 million.
Former President Reagan was a proponent of the trickle-down theory of economics. But all I have seen trickle down to the state and local levels are programs the federal government started and then dumped on the states without the financial resources to pay for them. You don't need a Ph.D in economics to know that massive federal borrowing drives up interest rates for businesses and governments alike.
Because most states, including Maryland, can't operate with a budget deficit, some 30 states are cutting spending or raising taxes, or doing both, to balance their budgets. Unlike the federal government, Maryland has been dealing with its budget problems. We've had four rounds of cost containment during fiscal year 1991 -- the latest to solve a $109 million shortfall.
Now, the federal government can -- and must -- do the same thing, by giving one individual a big enough sword to slay the dragon.
Unfortunately, the federal government has no high-level chief financial officer, no one with the authority to make fiscal decisions and make them stick. The federal buck doesn't stop anywhere any more.
My counterparts across America are determined to solve this problem. As members of the National Association of State Auditors, Comptrollers and Treasurers, we know the need for a national chief financial officer for the United States of America. We need a powerful individual who can help establish sound financial practices and reliable financial data. The federal government must start to follow the example that the states have set.
Will the next generation struggle under a mountain of debt created by the federal government's indecision, deception and cowardice? Or will we start to solve the problem now?
One great president has already called for a simpler federal financial system, one that members of Congress and the citizens of this nation can both understand. Unfortunately, the call that President Thomas Jefferson issued in 1802 hasn't been heeded yet. How much longer can we afford to wait?
Louis L. Goldstein is comptroller of Maryland.