Listen Live
Ball State University entrance sign.

Source: (Photo by: Education Images/Universal Images Group via Getty Images)

MUNCIE, Ind. — Fiscal conservatives have said in the last few months that spending cuts need to happen in order to reign in the nation’s debt.

Ball State economist Dr. Michael Hicks believes spending cuts can help, but that it will take a lot more than that to get the nation back in a position where future generations will not be paying for Baby Boomers and Gen-X Americans to retire.

“If we got rid of the Navy, if we got rid of the Air Force, we’re still going to run a deficit,” Hicks said on Indy Politics. “It really comes down to Social Security, Medicaid, Medicare, and federal government, military retirement, and veterans healthcare. Those things all cost more than the taxes we are collecting.”

It’s for this reason that Hicks believes, begrudgingly, that the U.S. is in a position that requires tax increases to pay for these programs.

Hicks points out that a big reason why the cost of these retirement programs has gotten so high is that people are much living longer than when these programs were first rolled out, such as Social Security which was first implemented in 1937.

“How do we change benefits structures,” asked Hicks. “Social Security was designed when the average median life span was in the late 50s. Most people didn’t live to be 65 in 1937. Today the life span is going to be pushing 80 … maybe close to 90.”

The bottom line, according to Hicks, is that spending cuts alone are not going to solve the nation’s debt issues.

“Sometimes all that does is build up deficits in other places,” he said. “We had a hollow Army in 1980. We cut spending so much in the military that were actually probably unable to prosecute a war against the Soviet Union if we had to.”

Hicks said it’s about finding a cautious balance between cuts spending also making sure the government is taking in enough money to cover the cost of social programs that many older Americans rely on.