| FOR IMMEDIATE RELEASE |
Tuesday,
March 19, 2002 |
| CONTACT:
Colleen Kroll |
(202)
225-5235 |
"Hitting
Our Heads on the Debt Ceiling:
A Headache for Our Country"
by Congressman Allen Boyd
Later
this year, President Bush is going to ask Congress
to raise the Federal debt ceiling by 750 billion
dollars. The last two votes to raise the debt
limit came after Congress and the President reached
a bipartisan agreement on a balanced budget plan
that ultimately led to the Balanced Budget Act
of 1997. We must recall the successful outcome
of these negotiations, and avoid taking ten steps
back by disregarding proper and fair legislative
procedure. We must make sure that Congress has
a plan to return the budget to balance before
we even think about raising the debt ceiling.
In
1997 Congress and the President made the hard
choices necessary to ensure we reached a balanced
budget and put the necessary budget tools, or
legislative procedures, in place to make it work.
President Bush will be asking for a 750 billion
dollars increase in the debt ceiling, without
a plan for getting us back to a balanced budget
and without providing any of the tools necessary
to help us get there.
Last
year, like many others in Congress, I warned the
President not to rely on overly optimistic economic
forecasts, but no one could have anticipated how
much the budget forecast would change in just
one year. Earlier this year, the President submitted
a budget which forecasts deficits being financed
by taking money from the Social Security surplus
for the next decade and beyond.
Last
year the President's budget projected that, even
with the passage of his tax cut and other policy
priorities, there would be a 10-year budget surplus
of $3.4 trillion, which would be enough to eliminate
the publicly held debt by 2008. The administration
also stated that we would not have to raise the
debt limit for seven years, and actually claimed
that there was a danger the government would pay
off the debt too quickly. Since then, the recession
has lowered revenue estimates and the attack on
September 11th has led to a dramatic increase
in spending in order to fight terrorism abroad
and to provide for homeland security.
Now,
the Congressional Budget Office is forecasting
that the Federal government will have to borrow
money from the public to pay its bills for the
first time in four years. According to the latest
estimates, non-Social Security surpluses will
not return until 2010, near the end of the budget
window, when economic forecasts are little better
than wild guesses. This means the Federal government
will have to borrow money from the Social Security
Trust Fund until 2010.
While
this is certainly a reversal from the last four
years when we were paying down debt, the problem
is doubled by the fact that we, as taxpayers,
will also have to pay interest on all of this
new debt. This year's economic projections from
the Congressional Budget Office budget states
that instead of being paid off by 2008, debt held
by the public will be 2.8 trillion dollars in
2008. Interest payments add 1 trillion dollars
to government spending over the same 10 year projection.
This one trillion dollars could have been used
to fund a prescription drug benefit, or for increased
defense spending, or it could have been used as
a down payment to reform the Social Security program,
or provide additional tax cuts. Instead it will
go to paying interest on money that we will have
to borrow under the President's budget proposal.
I
absolutely agree with the President on the need
for increased spending on national defense, but
the war and recession represent only a small part
of the reason the debt limit will have to be increased.
I am concerned about the size of the debt limit
increase requested by the President and with the
fact that it is not accompanied by a plan to put
our fiscal house in order. Raising the debt ceiling
is now necessary as a result of the past year's
budget practices because we do not want to default
on our debt. However, while I am willing to authorize
debt to cover the costs of the war and the impact
of the recession, I am not comfortable with allowing
the government to continue on a path of deficits
as far as the eye can see with no plan in place
to return the budget to balance.
I
understand that short term deficit spending may
be necessary to provide our men and women in uniform
the resources necessary to win the war against
terrorism, and I support those efforts. However,
I urge Congress to think about the request the
President is making in conjunction with his budget
request. Do we really want to borrow from the
Social Security Trust Fund until 2010? Do we want
to give the President this request without extending
the discretionary spending caps? Without extending
the pay-go rules governing tax legislation and
entitlement programs? These tools, and the 1997
budget agreement, were what we used to make the
tough choices necessary to stop the raid on the
Social Security Trust Fund and return our Federal
budget to balance. Without these tools or a plan
to balance the budget, and with $750 billion more
to borrow, I am concerned that we will bump up
against the debt ceiling much quicker than anyone
expected.
This
is why I am working with my colleagues in the
Blue Dog Coalition to urge Congress and the President
to ensure that we quickly return to a balanced
budget before raising the debt limit and continuing
the raid on Social Security and Medicare trust
funds. |
Biography
Back to top