The House Republicans have been setting the terms of the budget debate ever since Rep. Paul Ryan unveiled his “Path to Prosperity,” and now they’ve upped the ante. In a speech in New York City, Speaker John Boehner said any increase in the federal government’s debt limit must be accompanied by even larger spending cuts:
Without significant spending cuts and reforms to reduce our debt, there will be no debt limit increase. And the cuts should be greater than the accompanying increase in debt authority the President is given.
A few thoughts on why this is good policy and good politics:
First, it’s good policy because a “clean bill” to raise the debt ceiling, as the Obama administration wants, would be disastrous policy. Congress has proven that the mere requirement to raise the ceiling is not a sufficient restraint. And it’s become clear that the 2012 budget is not going to produce a grand bargain. If there’s going to be a compromise that begins to apply some semblance of fiscal discipline to Washington, the debt ceiling is the time for it.
Second, it’s good policy because a more-cuts-than-new-authority approach is perhaps the only way to put teeth into the restraint side of the compromise. In an editorial, The Wall Street Journal reports that Boehner’s advisers say “those cuts would have to be scored as real by the Congressional Budget Office over a five-year budget window.” This is hardly Draconian: A debt-ceiling increase of $2 trillion through the end of fiscal 2012 — which the White House says is necessary to keep the government running until Oct. 1, 2012 — would mean spending cuts of $2 trillion over five years, or $400 billion a year. In fact, it comes closer to being too weak a proposal given the severity of our debt problem. A $400 billion cut this year could still leave us with an annual budget deficit approaching $1 trillion.
Third, it’s good politics because it shows the House GOP learned a thing or two from its negotiations over the budget for the remainder of fiscal 2011. Note the part of the above quote about “scored as real by the Congressional Budget Office.” Republicans got burned when the $38 billion in 2011 budget cuts turned out to be more like $352 million this year — just 1 percent as much as advertised. The cuts can’t consist of programs that were already discontinued or mere reductions from what President Obama has requested for 2012. They need to be taken from real spending levels this year.
Fourth, it’s good politics because it’s common sense. Opinion polls (see question 10 in this recent one, for example) show Americans strongly disagree with raising the debt ceiling in the first place. So, raising it at all is an act of compromise with taxpayers. The price of the compromise is a pledge to spend less taxpayer money in the future. It’s kind of like the terms of a loan: If you want to borrow $10,000 today, you have to promise to repay that $10,000 with interest in the future. (Although, as I noted above, the fact that borrowing would remain high means Washington is still acting like the loan shark in this situation.)
Finally, it’s good policy and good politics because it sets a precedent in which cutting spending is necessary. That’s good policy because our problem will spiral out of control otherwise. And it’s good politics because, as others have noted before, we need a system in which politicians compete to spend less of our money, not more.
– By Kyle Wingfield