Surprise, Surprise! It’s Time To Go Through The Debt Limit Raising Hassle Again
By Dr. Thomas Patterson |
Democrats are clamoring for immediate action to avert a financial crisis which would be blamed on Republicans, just because. Meanwhile, the Republican campaign conservatives aren’t showing much enthusiasm for this rare possibility of achieving significant fiscal reform.
Treasury Secretary Janet Yellen rolled out the traditional arguments for raising the debt limit in the Wall Street Journal. Raising the limit doesn’t authorize additional deficit spending, which is true, as far as it goes. But it does ratify the overspending that has occurred, which keeps the ball rolling for spenders.
But she whiffs on the real point. The greater danger to our credit-worthiness would be to continue the present course. As our indebtedness climbs to stratospheric levels and interest rates return to normal, our fundamental ability to service the debt becomes questionable, as our geopolitical rivals well know.
America is going to pay its debts. Yet in an obvious attempt to bullrush Republicans into compliance without conditions, Secretary Yellen warns that any failure could cause economic damage so severe as to be permanent.
Indeed, the titanic struggle over the 2011 debt limit increase, which resulted in a $2.1 trillion spending cut, caused a significant downturn in financial markets. However, spurred by the spending cut and the vitality of America’s private sector, all the losses and more were made up within the year.
Yellen notes that Congress has raised or suspended the debt ceiling 80 times since 1960, so it must be no big deal, right? But what’s wrong with this picture?
All 80 times, the effect was to increase America’s borrowing capacity. It has never been reduced. The routine, expected raising of the debt limit is the enabling mechanism that has allowed us to slide into treacherous financial territory.
Republicans have never had a better opportunity to break this self-perpetuating cycle. Democrats are on a world record spending binge. Their majorities are slim and fractious. They desperately need Republican cooperation.
So Republicans are threatened with being saddled, again, with responsibility for the dreaded government “shutdown”. Previous shutdowns prohibited WW II veterans from visiting their DC memorial and prevented the viewing, even from the highway, of Mount Rushmore.
But government employees and beneficiaries were exempted. Nonessential employees got the best deal of all. They were furloughed but promised a complete pay reimbursement after the “shutdown.” Road trip!
Both Yellen and Biden insist that raising the debt ceiling in the past was bipartisan. That doesn’t make it right, of course. Still, the claim holds true only if you consider a 98.8% negative Democrat vote on the three debt ceiling bills during the George W. Bush administration to be “bipartisan.“
But the screws on Republicans get tightened anyway. “I can’t believe Republicans will let the nation default“ by not raising the debt limit, Chuck Schumer mourned at a recent press conference. As usual, the Chuckster was making it up.
Democrats control the White House and both houses of Congress. They don’t need a single Republican vote to do whatever they wish. They could have simply included the debt limit provisions in a budget resolution, a reconciliation bill not subject to the filibuster and thus not requiring Republican votes to pass.
Schumer instead moved the debt limit to regular legislation requiring 60 votes so that Republicans could be blamed for its failure. Democrats understandably don’t want the political blame for pushing our nation deeper into debt. But why should Republicans bail them out when the budget-crushing Biden era spending bills have passed with almost exclusively Democrat support?
Based on their record when in power, Republicans may not be sincerely interested in living within our means either. If they are serious, they must learn from past mistakes. Previous budgetary reforms included in debt limit bills have failed because they were later amended or ignored.
This time, Republicans must demand limitations that are self-activated and self-enforced, not subject to congressional amendment, at least for a time certain. Congressional proposal of a debt-limiting constitutional amendment should be on the table.
For common sense fiscal conservatives, this is our time. Success requires boldness and bravery.
Dr. Thomas Patterson, former Chairman of the Goldwater Institute, is a retired emergency physician. He served as an Arizona State senator for 10 years in the 1990s, and as Majority Leader from 93-96. He is the author of Arizona’s original charter schools bill.