Congress is facing two critical fiscal deadlines in the very near future. Our current debt ceiling of $18.1 trillion will be exceeded by November 4. A temporary 2016 budget was passed that will fund the federal government at its current level through December 11. There is much pressure on Congress to lift the sequester limits for discretionary spending which have been in effect since early in 2013. The Republican majorities in Congress should use their leverage to promote fiscal responsibility in the following way:
- Extend the debt ceiling by $1 trillion or enough to last about two years at our current rate of deficit spending. Control over the debt ceiling gives Congress an important tool with which to remind the voters of the urgency of shrinking the national debt. Make it clear that in return for supporting payment of existing obligations, Republicans will insist on far more spending restraint in the future.
- For example, Congress should agree to only additional short term extensions of this year’s budget at current spending levels, including sequester limits, until a long-term budget plan is locked into place along the lines of:
- The ten year budget plan adopted by Congress last Spring produces a balanced budget by 2025. Perhaps surprising to many people, it still allows spending to increase by 3.3% annually which is approximately double the current rate of inflation.
Such a plan of indefinite short term budget extensions at current levels will get the focused attention of all big spenders including conservatives who want more military spending as well as the President and his Democratic allies in Congress. Everything should be on the table: entitlement reform, tax reform, immigration reform, etc. There need be no deadline for agreement; the current budget could simply be renewed at short term intervals until a mutually acceptable plan was achieved. No plan, then no budget increases. Take your pick.
Conclusion: a national debt of 74% of GDP is in fact a fiscal crisis and the Republicans have enough leverage to force a showdown in a sensible way. They should use it!