‘Cutting, capping and balancing’ to fiscal order
May 16 marked a historic day in the life of the nation. In a day filled with emotion, space shuttle Endeavour lifted off from Kennedy Space Center in its final launch, commanded by Mark Kelly as wife Rep. Gabrielle Giffords (D-AZ), recovering from her tragic shooting in January, watched from the gallery below.
But May 16 signified another milestone: the day the federal government hit its $14.3 trillion debt ceiling—145 years to the day, incidentally, after Congress authorized a mint for the 5-cent piece. That’s more than 285 trillion Jefferson-plated coins of debt borrowed from the public and owed to federal trust funds. How far we have come.
While this is not the first time Washington has reached its fiscal breaking point—the debt ceiling has been raised 74 times in the last 50 years, according to the Congressional Research Service—public officials are clamoring to address the issue. The government is now borrowing on borrowed time. Treasury Secretary Timothy Geithner says he can juggle assets until Aug. 2, at which point the government will default.
To deal with the debt, some lawmakers and the White House want a “clean” debt ceiling increase with no spending cuts. A House vote on such a measure to lift the ceiling by $2 trillion will occur next week. It is expected to fail.
Others, more sensibly, view any consideration of a debt ceiling increase without serious reforms and belt tightening as a non-starter. Government, as they rightly see it, does not have a revenue problem, but a spending problem.
Among this latter group, a large number of conservatives led by Rep. Jim Jordan (R-OH) are advocating a three-part solution: cutting discretionary and mandatory spending in order to slash the deficit in half next year; capping federal spending at 18 percent of Gross Domestic Product (GDP); and sending the states a balanced budget amendment. More than 75 representatives have signed onto a letter to be sent to House Speaker John Boehner (R-OH) backing the “cut, cap and balance” plan.
The cuts in spending for next year could total in the neighborhood of $300 billion from current levels. A cap on spending relative to GDP would bring current outlays of roughly 25 percent of GDP in line with historic rates of 15-20 percent. And a balanced budget amendment, such as H.J.Res. 56, would bring greater accountability to lawmakers, forcing them to appropriate within the nation’s means—a practice most states are obligated to follow and something most Americans know a thing or two about in their own households.
The Ethics & Religious Liberty Commission considers this approach a step in the right direction. For the ERLC, the nation’s fiscal mismanagement, to put it charitably, is not an economic issue that ought to be divorced from Christians’ concerns. It is a moral one. The current track of “[s]uch irresponsible borrowing from our children’s and grandchildren’s futures is immoral and must be stopped,” states the ERLC’s 2011 legislative agenda. When a government spends money it does not have, bankrupting future generations, it threatens livelihoods and futures. Most Americans know what it means to live by a budget. Is it too much to ask Congress to do the same?
Thomas Jefferson once told his fellow countrymen that “we must not let our rulers load us with perpetual debt.” Two centuries later, it is painfully clear that the nation has not heeded our third president’s admonition. What also seems clear is the path toward ridding the perpetual debt we now shoulder: cutting, capping and balancing. You may want to urge your representative to support such a plan.