Monday, June 16, 2008

Take Away Their Credit Card!

Well hoorah, hoorah! Some folks in Congress finally realized spending is just flat out, out of control and can’t be sustained over the long run. Well, duh! It doesn't take a genius to figure that one out. Take a look at the current total … almost $9.5 trillion in total U.S. debt. America doesn't rack up that much debt because Washington taxes too little. Congress has racked up $9.5 trillion debt because they spend far more money than they’re taking in.

Whenever they don’t have enough money, they merely vote to raise the debt ceiling. By raising the ceiling, they can spend more money but not technically have to vote for an increase in taxes. That, however, is a misnomer since a vote for an increase in the debt ceiling is nothing more than a vote for tax increases on future generations, your children and grandchildren.

Clearly something is needed to force Congress to curb their rampant spending spree. Right now, there’s nothing to stop it as they have the power to increase the spending limit whenever they choose … and they've readily done so:

2002 Increased the debt ceiling to $6,400,000,000,000.00
2003 Increased the debt ceiling to $7,300,000,000,000.00
2004 Increased the debt ceiling to $8,180,000,000,000.00
2006 Increased the debt ceiling to $7,300,000,000,000.00
2007 Increased the debt ceiling to $9,815,000,000,000.00

Please note that I've chosen to display ALL the zeros to emphasize just exactly how many dollars that actually is!
H.J. Res 92, which is now before the Senate, proposes to increase debt ceiling to $10,615,000,000.000.00. Hello … Senators Reid and Ensign … don’t mortgage our future generation’s livelihoods. Cap the spending!

In 43 out of the last 48 years, federal government spending has exceeded federal government revenues. The federal budget cannot and should not grow faster than American families’ are able to pay for it. But if Congressional spending is left in ‘auto’, you and I will see taxes double by 2040, just to pay for the ‘spending.’ That doesn't take into account any monies needed to begin to pay down the national debt, which now sits at 66% of GDP. By 2040, the debt-to-GDP ratio will be a lot higher than 66%, if outrageous Congressional spending isn't somehow curbed.

The only way to control federal spending is to take away the government’s credit card … Ron Paul.

Reps. John Campbell (R-CA) and Jeb Hensarling (R-TX) of the Republican Study Committee are introducing a "spending limit amendment" which would be an amendment to the U.S. Constitution.

"Spending caps will finally force lawmakers to set priorities and make trade-offs. Today, without such spending limits, Congress has strong political incentives to give into every spending request without searching for responsible offsets or making any hard decisions. Because interest groups will continue pressuring them to spend, lawmakers need a budget process that helps them say no. By offering a constitutional amendment rather than a statutory reform, Reps. Campbell and Hensarling set a high bar for enactment, but would create a cap less prone to legislative gaming (it could be waived only during wartime or with a two-thirds supermajority vote in Congress).

There are two ways to improve the amendment. First, Congress should base the spending cap on a rolling average of the previous five years’ economic growth (rather than three) to further smooth out the yearly cap adjustments, and to avoid situations where large spending increases would be allowed in economic booms (when they are least needed), and deeper spending restraint required during sluggish economic times (when spending would automatically rise faster). Second, states are unlikely to ratify such an amendment if they fear lawmakers will restrain spending by dumping new unfunded mandates on them. This could be addressed with a provision stating that the federal spending cap would be automatically reduced by the cost of any new unfunded mandates.

Reps. Hensarling and Campbell should be applauded for seizing on spending caps as the best way to restrain expanding government. Lawmakers interested in spending restraint should take this proposal seriously."

— from
The Heritage Foundation, Leadership for America blog

I agree with Ron Paul … let’s take away Congress’ credit card! Let’s pass the constitutional amendment to cap spending limits and take the ability of Congress to merely raise the spending limit at their whim away from them.


Sofia Kim said...

A series of debt can lead to a very difficult cycle of unmanageable finances. We should find ways on reducing debt the cheapest way possible and enjoy financial freedom. Thanks for the article!

nicki said...

The biggest spender in the federal government is the Pentagon. Until we stop the war and Iraq and the gone wild spending the military does I can't see an end to debt.