Budgets and debt ceilingsPosted: 21 Jul 11
I am so frustrated by the crowd in Washington. First, we have the people who traditionally wanted to be known as the Party of Fiscal Responsibility. Once they got control over both houses of Congress and the White House, they switched. They weren’t Tax and Spend Democrats but they were Cut Taxes and Spend Republicans, which is even worse. Suddenly they lose that control and it’s back to the old rhetoric of debt for our children and grandchildren and live within our means like families have to do.
Let me tell you something. Families borrow money too. In fact, that’s one of the problems that got us into our current mess, too much debt by families. But I have to say, debt in and of itself is not a bad thing, and if you need to borrow more to keep from having to pay higher interest on your existing debt, and your creditors are only too happy to let you, I say go for it. As long as you do something to raise income and cut spending (both really). If you want to use the typical family as a model, when they hit a rough patch, they do cut spending, but they also try to do something to increase income, too. The other employed members inquire about raises, or they get part time jobs, or they do temporary or contract work. They don’t fold their arms and insist that they only thing they can do is cut, cut, cut. And for Texas Republicans, let me point out that they dip into savings, too when it’s really important.
Then we have the Democrats. Ugh, where do I start. No, you don’t have to keep giving in to Republican demands. The Republicans were never going to sign on to Health Care reform. We’d have all been better off if you had told them “forget you” early on and just went with the public option instead of this intrusive individual mandate. I don’t want the individual mandate to be constitutionally permissible and I would prefer the public option anyway. Seems to me that the public option is going to be better for price controls anyway.
But I digress. Debt ceilings. No one is even considering the idea of paying back any debt yet. For the foreseeable future, we’re still running deficits; right now the question is how big those deficits are going to be. Okay, fine. So we’ve got over $14 trillion in debt already, if we’re going to have to pay interest on it for the foreseeable future, the responsible thing to do is to make dad-gum sure that we pay the lowest interest we can. There is no sense at all in even threatening to hit the debt ceiling because even if nothing else happens, our credit is going to be downgraded and we ARE going to pay more interest on any new debt we take in, including rolling over the debt obligations we already have. The stupidity of the Republicans in playing chicken with the debt ceiling is mind-boggling. So much for Fiscal Responsibility.
So what would it take to pay down some of that $14 trillion in debt? Budget surpluses. Yes. As long as you are spending more than you take in, you have to increase the debt. If you balance the budget, spend just what you take in, you don’t have any money left over to pay down any debt. The ONLY way you can pay down debt is if you have more revenue than expenditures. Period. The math isn’t even complicated. There is no way we’re ever going to see surpluses again without raising some new revenue somewhere. Can’t be done. Anyone who tells you that they want to cut debt without raising taxes probably also has a bridge to sell or water rights in Death Valley he’s not using.
I grew up in South Dakota in the 70s and 80s. I cut my political teeth on huge deficits and mounting national debt and all around me heard about fiscal responsibility. I was shocked in the late 90s when the federal government actually started running a surplus. Shocked! I was further mind-boggled when a Republican President and a Republican Congress then decided not to pay down the debt and instead cut taxes.
I’m no longer boggled when Republicans not only don’t want to do the fiscally responsible thing or when they would rather try their hardest to do the most irresponsible thing possible. I am still disappointed. Especially when they still spew the old familiar anti-debt tune. I mean spew it again. Not “still.” Once again they spew the old familiar anti-debt tune that they had hidden in the back of their album caddies during the Bush years.