Gentlemen may cry default, default, but there will be no default. (With apologies to Patrick Henry.)

Once again the media are full of talk about dysfunction and default, as the partial government shutdown threatens to linger until the federal government hits the limit of its borrowing capacity, possibly on Oct. 17. The parties in Congress are still far apart on passing a budget bill to keep the government running, and Republicans are also promising not to raise the debt ceiling without some spending reforms.

If in fact Congress doesn’t raise the ceiling by mid-October—or by November 1 or so, when the real crunch might come—then the federal government would be forbidden to borrow any more money beyond the legal limit of $16.699 trillion. But it would still have enough money to pay its creditors as bonds come due. The government will take in something like $225 billion in October, but it wants to spend about $108 billion more than that. You see the problem. If it can’t borrow that $108 billion—to cover its bills for one month—then it will have to delay some checks.

Now the U.S. Treasury isn’t full of stupid people. Back in 2011, when the debt ceiling of $14.3 trillion was about to be reached, the Washington Post reported:

The Treasury has already decided to save enough cash to cover $29 billion in interest to bondholders, a bill that comes due Aug. 15, according to people familiar with the matter.

You can bet they’re making similar plans today.

Back in that summer of discontent I talked to a journalist who was very concerned about the “dysfunction” in Washington. So am I. But I told her then what’s still true today: that the real problem is not the dysfunctional process that’s getting all the headlines, but the dysfunctional substance of governance. Congress and the president will work out the debt ceiling issue, if not by October 17 then a few days later. The real dysfunction is a federal budget that doubled in 10 years, unprecedented deficits as far as the eye can see, and a national debt bursting through its statutory limit of $16.699 trillion and heading toward 100 percent of GDP.

We’ve become so used to these unfathomable levels of deficits and debt—and to the once-rare concept of trillions of dollars—that we forget how new all this debt is. In 1981, after 190 years of federal spending, the national debt was “only” $1 trillion. Now, just 33 years later, it’s headed past $17 trillion. Traditionally, the national debt as a percentage of GDP rose during major wars and the Great Depression. But there’s been no major war or depression in the past 33 years; we’ve just run up $16 trillion more in spending than the country was willing to pay for. That’s why our debt as a percentage of GDP is now higher than at any point except World War II. Here’s a graphic representation of the real dysfunction in Washington:

Those are the kind of numbers that caused the Tea Party movement and the Republican victories of 2010. And many Tea Partiers continue to remind their representatives that they were sent to Washington to fix this problem. That’s why there’s a real argument over raising the debt ceiling. It’s going to get raised, but many of the younger Republicans are determined to set a new course for federal spending in the same bill that authorizes another yet more profligate borrowing.

And where did all this debt come from? As the Tea Partiers know, it came from the rapid increase in federal spending over the past decade: 

Annual federal spending rose by a trillion dollars when Republicans controlled the government from 2001 to 2007. It rose another trillion during the Bush-Obama response to the financial crisis. So spending every year is now twice what it was when Bill Clinton left office a dozen years ago, and the national debt is almost three times as high.

Republicans and Democrats alike should be able to find wasteful, extravagant, and unnecessary programs to cut back or eliminate. And yet many voters, especially Tea Partiers, know that both parties have been responsible for the increased spending. Most Republicans, including today’s House leaders, voted for the No Child Left Behind Act, the Iraq war, the prescription drug entitlement, and the TARP bailout during the Bush years. That’s why fiscal conservatives have become very skeptical of bills that promise to cut spending some day—not this year, not next year, but swear to God some time in the next ten years. As the White Queen said to Alice, “Jam to-morrow and jam yesterday—but never jam to-day.” Cuts tomorrow and cuts in the out-years—but never cuts today.

If the “dysfunctional” fight that has sent the establishment into hysterics finally results in some constraint on out-of-control spending, then it will have been well worth all the hand-wringing headlines. The problem is not a temporary mess on Capitol Hill and not a mythical default, it’s spending, deficits, and debt.

The abuse and overspending in government disability programs is so bad that even National Public Radio and 60 Minutes have taken notice. On the heels of this excellent NPR examination of the “disability industrial complex,” the venerable CBS news show last night profiled Senator Tom Coburn’s efforts to uncover fraud in the two big federal disability programs.

The combined spending on Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) has risen to a huge $200 billion a year, so kudos to the mainstream media for sounding the alarm on these programs. What we need now is for other fiscal conservatives on Capitol Hill to stand with Senator Coburn and demand reforms.

There appear to be millions of people on the disability programs whose ailments are not actually severe enough to warrant coverage or who are outright scamming the system.  On 60 Minutes, Senator Coburn guessed that one-quarter or more of the people currently on the disability programs shouldn’t be. The following chart (sourced here) from Tad DeHaven supports Coburn’s assessment:

During the 1970s and 1980s, the ratio of people on SSDI to the U.S. workforce averaged 3.4 percent. That ratio has now more than doubled to 7.4 percent, even though the actual rate of disability among the working-age population is thought not to have increased in recent decades.

The following chart illustrates the problem from another angle. It uses data compiled by Jagadeesh Gokhale from the Current Population Survey on men aged 20 to 59 with a work-limiting health problem. Within this group, a falling share are working and a rising share are going on SSDI and not working.

As DeHaven explains in his recent reports on SSDI and SSI, the rapid growth in these programs is very troubling, and not just because of the rising taxpayer costs. The programs are apparently inducing many people who could be using their skills productively in the economy to instead drop out and go on the federal dole.

All government subsidy programs undermine individual responsibility and induce unproductive behaviors. This is true, for example, of the roughly $30 billion in annual federal subsidies for farm businesses. Each year federal disability programs pump out six times more benefits than farm subsidies, so it wouldn’t be surprising if the distortions and economic harm created is far larger.

The GOP is attempting to defund ObamaCare by holding the federal government hostage.  Congressional Republicans say:  Cut the spending or Uncle Sam will have to stay home.

Unfortunately, while the public doesn’t favor President Obama’s plan to nationalize American health care, people seem even less enthused about Republican tactics.  Better would be a threat to close down the government because the government should be shuttered.  The GOP should seek to eliminate entire programs and agencies.

Federal control of health care is a good place to start.  The U.S. medical system is a mess, but the government should not decide who gets how much health insurance in what form through whom.

Moreover, as I wrote in Forbes online:

Corporate welfare should be another target.  Republicans rightly worry about perverse incentives created by welfare for the poor since federal programs have wrecked families and communities while discouraging education and work.  However, even less justified are a variety of payments to dependent businesses.  Export subsidies, research grants, farm subsidies, housing aid, regulatory preferences, and more.

There’s no better reason to underwrite smaller enterprises, through the Small Business Administration.  Is there really a critical scarcity of liquor stores requiring taxpayers to pay for additional ones?

Some tasks, such as the Department of Housing and Urban Development, just aren’t Washington’s job.  Worrying about the construction of apartments and homes should be left to localities and states.

Another unnecessary bureaucracy is the Department of Education.  The national government shouldn’t be trying to run local schools.  And why should lower-income taxpayers subsidize middle-class kids who want to become lawyers?

Grant the federal government authority to create parks involving uniquely scenic or otherwise special lands.  There’s still no reason for the Interior Department to own and manage hundreds of millions of acres of forest and range land.

The Department of Defense possesses—at the sufferance of foreign governments—hundreds of properties abroad.  While maintaining cooperative relationships with foreign militaries as well as access to some of their bases is useful, the U.S. has no need for innumerable facilities and garrisons around the globe.  The U.S. should act as a back-up against the rare hegemonic threat that friendly states could not handle rather than the guardian against every mundane controversy and conflict that arises elsewhere.

Foreign facilities often are justified as logistical way stations for intervening in the Middle East or Central Asia.  However, Europe should provide the troops as well as the bases to deal with such hot spots as Egypt and Syria.  It would not be isolationism for America to more humbly and prudently engage the world.

Foreign aid should go the way of military intervention.  Even humanitarian assistance can have counterproductive impacts, while economic assistance has been a grand failure, doing more to subsidize debilitating collectivism than promote economic reform.

There’s much at the Justice Department that should be eliminated.  Federal criminal law has exploded.  In some cases Congress makes crimes out of actions that should be left to civil punishment—environmental disputes, for instance.  Federal lawyers also have become the vanguard of political correctness, enforcing a racial spoils system under the guise of promoting affirmative action.

Other federal sacred cows also deserve challenge.  The Drug Enforcement Agency arrests people because they prefer to get intoxicated with drugs rather than alcohol.  There are scores of welfare and job training programs of dubious effectiveness.  If Washington moved from the income to a consumption tax, the IRS would be smaller and much less intrusive.

While many people are criticizing Republicans for threatening to close the government over ObamaCare, there actually is good reason to go to the brink on shrinking the American Leviathan.  Washington meddles in Americans’ lives far more than the Founders ever imagined—and circumstances ever justified.  It’s time to reverse the process and really shut down government.