Projections by National Commission on Fiscal Responsibility and Reform (Photo credit: Wikipedia)
Here it comes again. Another battle to raise or not raise the debt ceiling for the United States. During recent debates, Democrats will once again accuse Republicans of holding the economy hostage by not giving in to every demand. Republicans insist it is merely fiscally responsible to spend more money without at least significant cuts. The hypocrisy of Republicans is that it had been raised so many times under Republican control. The hypocrisy of Democrats is how vehemently they — including some of the same congressmen pushing for now — rejected such a thing as irresponsible, and even immorally destructive just a few years ago. Behold, yet another case where we see political parties ultimately defining what is right and wrong solely by who is in power, meaning the majority of the purse strings.
Now if this was a sincere discussion, instead of pandering and laundering to their own respective political troughs under the guise of saving America, the simplest of questions would come up: how much is too much?
But the answer would not be some dollar amount based on a pet budget of the moment, or an accounting of specific needs to declare an emergency if not met, but a number that is based on some larger objective criteria. There must be some benchmark by which there is such a thing as too much. The spend or die mentality just doesn’t hold any water given government waste, unjustifiable military budgets, lack of reform in social programs and stimulus earmarks, or even the most insane delusion that such things simply don’t matter altogether.
What about another potential downgrade? What cause of that would make more sense, putting off a few bills, or going over a sane credit line so that the very money you are using to pay those bills even further threatens to become worthless?
Government functions under the same realities as a business, only it can get away with being in denial of those realities. A sane business would avoid expanding its budget unless it was already balanced. In fact it could never possiblIn survive if done repeatedly, and for a reason. And no one would blame the bank for “holding them hostage” until they straightened out their books. In fact, if things were in good order, and under competent management, they would need to do it in the first place. Most people intuitively know this, but the politicians are too busy rooting for the interests of their own teams.
Draw a line, or at least demand one be drawn.
So what kind of line could be drawn in the ledger? It could be a percentage of GDP (and I would argue the total budget itself should be measured in this way). It could be a percentage of the total federal budget. It could be as tried and true as some ratio of assets to liabilities. At worst, you could tell you late at what point it would be unrealistic to pay it back in some certain number of years, or at all, given current projections and protections.
But you can’t ignore the question and expect to sit at the adult table on this issue. You could say you are not an economist or knowledgeable enough to make such a call, but then why even have a strong opinion on the subject? And why should we assume our legislators know so much more than we do? I think it is obvious most don’t, and many don’t even care because the economy is not the goal for them.
Don’t believe me? Watch countless interviews where any questions about economics are side-stepped with fearful or feel-good answers. Apart from Ron Paul (like him or hate him), I have never heard any politician show any real understanding of such fiscal matters, or rather be willing to address them boldly for what they are.
Still don’t believe me? Ask them yourself. Ask them in a pointed letter — not in support or opposition to raising the debt ceiling — simply demanding an answer to this one question with an explanation. See if you get the usual form letter telling you nothing but their own position, glossing over objections you didn’t make and telling you what they’re going to do anyway.
In fact, I would put all of them to a simple test and see how well they even know basic economic and governmental financial statistics. I suggest we would be surprised if not shocked. But I could be wrong. This could be willful negligence rather than ignorance.
You decide. You argue it. But if you still haven’t come back to that one question, the real discussion hasn’t started yet. And in Congress, I wonder if it ever will.
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