This column by ACRU Senior Fellow Robert Knight was published February 8, 2015 atThe Washington Times.
In 1973, National Lampoon put a dog on its cover with a gun to the animal’s head. The tongue-in-cheek headline was: “If you don’t buy this magazine, we’ll kill this dog.”
In the same vein, President Obama might as well be preparing a new cover with a frightened elderly lady and a headline saying, “Raise the debt limit again or we’ll kill this woman.”
Mr. Obama threatens to withhold Social Security checks each time the debt limit deadline nears, ignoring the fact that even if the limit were met, the government could pay its debt obligation and all Social Security checks without going into default.
With the debt limit deadline approaching on March 15, and Mr. Obama pushing a nearly $4 trillion federal budget and new taxes, Democrats are licking their chops at any Republican resistance, which they cast as hatred for the poor. The GOP typically caves, and the debt keeps rising.
The kleptocratic Congress has proven over and over that it will not live within its means — the trillions of dollars extracted each year from working Americans.
Faced with threats to “shut down the federal government,” Congress has set debt limits, suspended them, and borrowed yet more money that future generations will have to pay. Note the distinction — suspended, not increased.
As Heritage Foundation economic analyst Romina Boccia explained last February, “When Congress suspended the debt limit through March 15, 2015, it did not limit the Treasury’s borrowing at all.”
The national debt, whose ceiling is supposed to be $17.2 trillion, has climbed, in suspension, to more than $18 trillion. “If Congress had simply increased the debt limit by $1 trillion, it would have limited the Treasury to borrowing an additional $1 trillion to finance federal spending,” Ms. Boccia noted.
Instead, Mr. Obama went on a spending spree with Congress‘ blessing, racking up even more debt.
Article I, Section 8 of the Constitution allows Congress to “lay and collect Taxes to pay the Debts” and to “borrow money on the credit of the United States.”
Who among the Founders knew that Congress would add zero after zero to the debt without blinking an eye and even without a declared war going on? If you’re prone to vertigo, you might want to avoid peeking at the fast-moving U.S. National Debt Clock on the Web.
Since the 114th Congress convened in January, there have been eight balanced budget-tax limitation amendments proposed. The tax limitation aspect is crucial. Imagine the kleptocrats armed with a constitutional order to balance the budget any way they can. My tattered wallet just hopped out of my pocket, raced over to the corner and is shivering in fear.
An approach that deserves consideration is the Debt Control and Fiscal Responsibility Amendment crafted by the late William A. Niskanen, who was acting chairman of President Reagan’s Council of Economic Advisers and a founder of the Robert B. Carleson Center for Public Policy, now the Carleson Center for Welfare Reform.
In a just-released paper for the Carleson Center, “The Case for a New Fiscal Constitution,” Lawrence A. Hunter, a former policy adviser to Reagan and former chief economist of the U.S. Chamber of Commerce, presents a tweaked version of Niskanen’s plan. Here’s a short, paraphrased version:
Congress may suspend the debt limit for not more than a total of 30 days during any single Congress, and only with a two-thirds vote in both houses of Congress. Congress can levy a new tax or increase a tax only with a two-thirds vote in both houses.
Now, here’s a provision that fans of federalism, and particularly the 9th and 10th amendments, should love: State and local governments must be compensated for the costs of any new federal mandate, and if not, they can ignore them. Any of this can be suspended in any fiscal year in which a declaration of war is in effect.
For the revised Niskanen plan to work, it would take implementing legislation similar to the proposed Full Faith and Credit Act of 2011. That bill would have directed the U.S. Treasury to first “make all interest payments on the national debt” and to ensure payment of “Social Security benefits and disability payments on time.”
As Mr. Hunter notes, “In other words, the link between holding the debt ceiling in place and the risk of default on the national debt and Social Security would be removed.”
Well, we can’t have that, can we? The bill passed the House but then-Majority Leader Harry Reid and company killed it in the Senate. Of course they did. How can you properly demagogue about Social Security checks if the threat is removed?
The newly constituted Republican Senate and House might want to take a serious look at the revamped Niskanen plan.
That is, if they’re honest enough to admit that Congress‘ frantic, lame-duck passage in December of the $1.2 trillion “cromnibus” right after the stunning Republican victories in November is not what voters had in mind.