The following editorial first appeared in the Dallas Morning News:
Emotional chest-thumping about the debt ceiling is a poor prescription for healing our nation’s fiscal illness.
Although most Americans are rightly worried about the dangers of the upwardly spiraling IOUs, we too willingly accept flawed, simplistic proposals that aren’t real remedies.
This reaction empowers our federal government to be irresponsible and ignores the shared sacrifice needed to tug the nation out of its financial quicksand. In public opinion polls, Americans say they want action to trim the budget deficit and national debt — just as long as the steps don’t involve spending cuts or higher taxes.
Would anyone seriously try that with your personal checkbook and expect results?
While it is tempting to say “enough is enough” and urge Congress not to increase the $14.2 trillion debt ceiling this year, the action would be imprudent and move the United States no closer to putting its financial house in order.
This may seem contradictory, but most of the needed money has already been committed, and the tax cut compromise passed in December created obligations requiring Congress to raise the debt ceiling.
In essence, lawmakers are arguing over whether to pay existing bills. The only sensible answer to that debate: It’s never wise to stiff your creditors, even if you’re Uncle Sam.
If lawmakers fail to raise the debt ceiling, they will face two catastrophic choices: huge spending cuts or tax hikes of several hundred billion dollars to meet this fiscal year’s financial obligations, or a decision by the world’s biggest economy to not pay its debts.
Both would shred the country’s economic credibility in the eyes of foreign investors, who, for some time, have been funding our lifestyles, excesses and all. Racking up long-term debt on the national credit card without a credible repayment plan has severe consequences.
It’s those concerns — and signs that Congress might again gridlock on the debt — that most recently prompted the rating agency Standard & Poor’s to change its outlook on U.S. securities to “negative” from “stable.”
The real unaddressed problem is Congress’ repeated failure to adhere to its own spending targets and to reform massively expensive entitlement programs such as Medicare and Social Security. Congress must commit to spending cuts and carefully reform the tax code so the burden is fairly shared, even if it means a tax increase for some.
Those are among the key recommendations of the president’s bipartisan fiscal commission, which tried to rise above the political gridlock.
So far, only small parts of the solution have emerged in competing deficit-curbing plans from Rep. Paul Ryan, R-Wis., and President Barack Obama. The Dallas Morning News is looking to the budget work by the bipartisan Gang of Six in the Senate to offer something far more comprehensive.
Anything less is an ineffective financial prescription that will leave the nation in even worse economic health.