Smith (WA09) - Editorials - Bring Back Fiscal Discipline

America=s economy is sinking fast, and our government seems ready to jump ship. Last month, the Office of Management and Budget revealed that projected federal spending deficits for this year have exploded to $165-billion, a clear signal that government has abandoned fiscal restraint at the expense of both our economy and the Social Security trust fund. Meanwhile, investor confidence has bottomed out and America=s businesses are scrambling for access to capital.

The release of these budget numbers must encourage serious review of the federal budget, as fiscal discipline is essential for the economic growth and stability America needs to get our economy in ship-shape. Right now, the federal government is avoiding difficult economic policy choices, promising with Asmoke and mirror@ budget gimmicks that we can have everything we want, and using irrational and inaccurate budget figures to paint pictures that are rosier than the truth. But at the same time, we are calling on corporate America to balance its books ethically.

How can we ask corporations to maintain honesty in their budgeting, when we in government cannot do the same?

Government has become addicted to making promises we just can=t keep. Over the past year, we have dramatically increased spending on farm subsidies by more than $100-billion over the next 10 years, passed the biggest tax city since 1981 with a 10-year cost of between $1.3- and $2-trillion, and met very necessary, but admittedly costly, expenses related to the war on terrorism. Unfortunately, the administration=s promise that next year=s budget outlook will improve doesn=t take homeland security expenditures into account B instead turning a blind eye to reality.

The first step to combating any addiction is to admit you have a problem. We have a big problem.

A return to sincere and deliberate fiscal responsibility must be the cornerstone of our government=s economic policy. In the 1990s, when Wall Street and Main Street saw that the government was serious about keeping its books in order and reducing the national debt, interest rates fell and private investment grew. Businesses created jobs and all Americas benefitted from lower interest rates on their mortgages, student loans and consumer credit.

Since our formation in 1997, members of the New Democrat Coalition have stood up again and again for fiscal responsibility and sound economic policy. We are centrist, pro-growth Democrats who embrace fiscal discipline, expanded trade, the New Economy and giving Americans the tools they need to succeed.

We have serious concerns about the current lack of a responsible economic plan that includes a balanced budget. While a one or two-year small deficit alone won=t jeopardize our future, if we continue down this path of undisciplined spending and realistic budgeting, our economy will be in greater trouble. To get back on track, Congress and the president must have the courage to make the hard, honest choices that are necessary to ensure deficits will be small and short-term. We must take action now with an honest discussion of the choices we face to develop a budget that is fiscally responsible.

As the leaders of the New Democrat Coalition, we are committed to working with the administration to develop a comprehensive bipartisan plan to balance the budget honestly. America needs a fiscally responsible budget that ensures we can both fight terrorism and grow our economy. We believe everything must be on the table for this discussion, including provisions of the tax cut passed into law last year but not yet enacted, corporate tax loopholes that allow businesses to evade taxes by incorporating overseas, and spending programs. Our only prerequisites are that we deliberate using honest numbers and maintain the integrity of the Social Security trust fund. We believe that a fiscally responsible plan to fight terrorism and get our economy moving again must be in place by the end of the fiscal year, and we will work to see that become a reality.



	*Bring Back Fiscal Discipline*

	with, Jim Davis and Ron Kind August 3, 2002

	America=s economy is sinking fast, and our government seems ready to jump ship. Last month, the Office of Management and Budget revealed that projected federal spending deficits for this year have exploded to $165-billion, a clear signal that government has abandoned fiscal restraint at the expense of both our economy and the Social Security trust fund. Meanwhile, investor confidence has bottomed out and America=s businesses are scrambling for access to capital. The release of these budget numbers must encourage serious review of the federal budget, as fiscal discipline is essential for the economic growth and stability America needs to get our economy in ship-shape. Right now, the federal government is avoiding difficult economic policy choices, promising with Asmoke and mirror@ budget gimmicks that we can have everything we want, and using irrational and inaccurate budget figures to paint pictures that are rosier than the truth. But at the same time, we are calling on corporate America to balance its books ethically. How can we ask corporations to maintain honesty in their budgeting, when we in government cannot do the same? Government has become addicted to making promises we just can=t keep. Over the past year, we have dramatically increased spending on farm subsidies by more than $100-billion over the next 10 years, passed the biggest tax city since 1981 with a 10-year cost of between $1.3- and $2-trillion, and met very necessary, but admittedly costly, expenses related to the war on terrorism. Unfortunately, the administration=s promise that next year=s budget outlook will improve doesn=t take homeland security expenditures into account B instead turning a blind eye to reality. The first step to combating any addiction is to admit you have a problem. We have a big problem. A return to sincere and deliberate fiscal responsibility must be the cornerstone of our government=s economic policy. In the 1990s, when Wall Street and Main Street saw that the government was serious about keeping its books in order and reducing the national debt, interest rates fell and private investment grew. Businesses created jobs and all Americas benefitted from lower interest rates on their mortgages, student loans and consumer credit. Since our formation in 1997, members of the New Democrat Coalition have stood up again and again for fiscal responsibility and sound economic policy. We are centrist, pro-growth Democrats who embrace fiscal discipline, expanded trade, the New Economy and giving Americans the tools they need to succeed. We have serious concerns about the current lack of a responsible economic plan that includes a balanced budget. While a one or two-year small deficit alone won=t jeopardize our future, if we continue down this path of undisciplined spending and realistic budgeting, our economy will be in greater trouble. To get back on track, Congress and the president must have the courage to make the hard, honest choices that are necessary to ensure deficits will be small and short-term. We must take action now with an honest discussion of the choices we face to develop a budget that is fiscally responsible. As the leaders of the New Democrat Coalition, we are committed to working with the administration to develop a comprehensive bipartisan plan to balance the budget honestly. America needs a fiscally responsible budget that ensures we can both fight terrorism and grow our economy. We believe everything must be on the table for this discussion, including provisions of the tax cut passed into law last year but not yet enacted, corporate tax loopholes that allow businesses to evade taxes by incorporating overseas, and spending programs. Our only prerequisites are that we deliberate using honest numbers and maintain the integrity of the Social Security trust fund. We believe that a fiscally responsible plan to fight terrorism and get our economy moving again must be in place by the end of the fiscal year, and we will work to see that become a reality.

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