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Beating Back Our
National Debt
By Mattie Corrao
After compelling the President to axe almost $80 billion from his
desired spending levels for the fiscal year, House Republicans are once
again faced with the prospect of negotiating with a recalcitrant
President on the next spending battle: the approaching debt ceiling. In
keeping with his inflated rhetoric on the threat of a government
shutdown, President Obama is feigning exigency once again, claiming a
“clean” debt limit vote is necessary to prevent government default and
certain economic catastrophe.
The request to increase the debt limit without confronting the actual
causes of debt belies the wisdom of having a debt ceiling – limiting
the government’s borrowing authority is supposed to inspire prudence,
not offer opportunity to flout it. What’s more, a “clean” debt limit
vote would be somewhat anachronistic; the limit has been raised ten
times in as many years with significant reforms attached, such as
passage of the Congressional Review Act in 1996 and the
Gramm-Rudman-Hollings budget reforms in 1985.
With the headroom on the $14.3 trillion debt ceiling closing in,
Republicans have offered several proposals that would address the
government’s overspending problem that drives the mounting debt. A
balanced budget amendment to the constitution is one suggestion, as are
serious statutory spending caps. However, the enormity of the
government’s overspending problem requires additional and serious
reform, addressing the seemingly insoluble spiral of entitlement
spending and rectifying the government’s bias to abuse, rather than
save, taxpayer dollars. The current political environment does not lend
itself to reform that fully rectifies these problems.
However, as witnessed in the funding debate, a Congress that is
unwilling to cut $100 billion at one time is comfortable with cutting
that amount in pieces every few weeks. This is a lesson learned from
the political success of the Left: the President’s “stimulus” binge,
health care takeover and financial overhaul were not simply a product
of Democrat majorities – they are an artifact of years of gradual
government creep, in which policymakers on both sides of the aisle were
complicit in bloated spending and increasing government overreach.
Addressing the statist assault will have to be done in the same way –
gradually. A short term debt limit that serves as a real and constant
reminder of the government’s overspending problem provides the
opportunity to do this.
Rather than granting the president massive spending authority for the
rest of his term in exchange for one piece of desired reform, Congress
should authorize short term extensions of borrowing authority.
Conservative members entered the 112th Congress with a number of good
ideas that represent several smart bargaining chips in exchange for
short extensions of borrowing authority. Using these proposals to chip
away at the government burden while denying the President carte blanche
on spending is a win-win for fiscal conservatives and taxpayers. This
keeps the Big Spender in Chief on a short leash to garner prudence the
White House is unwilling to commit to on its own.
It is important to note, however, that the debt limit fight is unique
from the FY 11 debate in a significant way: The President cannot share
the blame with Congressional Democrats. Despite the rhetoric employed
by the administration, reaching the debt limit is not equivocal to
default – not even close. The government currently takes in ten times
the amount needed in revenue to service the debt, and it is wholly
within Treasury’s authority to prioritize payments to investors to
avoid economic uncertainty. Thus, the blood of a government default is
fully on the hands of the President.
This presents effectively more motivation for the President to come to
the table on negotiating the debt limit. The FY11 funding battle
demonstrated that despite Candidate Obama’s platitudes on “reaching
across the aisle,” President Obama’s congeniality is in short supply
unless he is politically motivated to play nice with the other side. It
is clear that absent a born-again coming to bipartisanism, the
approaching debt ceiling represents a unique opportunity to keep the
channels between the two parties open in a divided government that is
only going to become more intractable ahead of the next presidential
election.
Likely unsatisfied with his takeovers of the health care and financial
industries in the first part of his term, the President no doubt has an
ambitious agenda for the next year that will need to be tamed and
difficult to stop if he has no reason to keep talking to Republicans in
Congress. For all of their negotiating prowess in the CR debate,
Republicans still only control one half of one third of the government
– lacking weight, momentum is the best strategy to aid taxpayers in the
year ahead. Making the debt limit debate exist in the short term
restructures the debt ceiling as an actual deterrent rather than a
theoretical one. The President’s inflated parlance on the looming
threat of fiscal catastrophe can’t win in that debate – fiscal
conservatives, and taxpayers, can.
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