Although Congress finally took action on the debt limit last week, the legislative hypocrisy on display fed public cynicism and underscored the need for debt limit reforms.
The fundamental problem is that Congress only considers a debt limit increase after it has already made the tax and spending decisions that require more borrowing. This encourages lawmakers to make irresponsible fiscal decisions and then declare themselves shocked and blameless as far as the growing debt is concerned.
Lawmakers also have decided that it sounds better to “suspend” the debt limit than to “raise” it, so technically they are merely suspending it until the Ides of March next year. But the effect is the same.
The final votes for a “clean” measure – one with no extraneous provisions – were 221-201 in the House and 55-43 in the Senate.
Traditionally, the party that does not hold the White House tries to pretend the debt is just the President’s problem. The party holding the White House vigorously objects, and there is finger-pointing all around.
We’ve just witnessed a textbook example.
Last month bipartisan majorities in the House and Senate passed a $1.1 trillion spending bill for this fiscal year. Yet last week most Republicans in the House and all of them in the Senate voted against suspending the debt limit, tut-tutting that the government was just spending too much money.
The Concord Coalition has called for debt limit reforms. Ideally, increases in the limit should be better aligned with tax and spending decisions, and tied to some relevant standard such as the growth of the U.S. economy.
External links:
‘Vote No, Hope Yes’ Defines Dysfunction in Congress (New York Times)
Fixing the Debt Limit Frankenstein (Concord Blog Post)
Federal Debt and the Statutory Limit (CBO)
Debt Limit Background (Treasury)
