As Americans deal with an economic hangover of high inflation and
rising interest rates
caused in large part by Washingtonâs
irresponsible spending spree
, House Republicans have delivered a legislative package to address these problems. Troublingly, leading Democrats are making patently false claims that will make it more difficult for the two sides
to find common ground
.
The past week has been a whirlwind of activity for federal finances:
- On April 26, the House passed the
Limit, Save, Grow Act
, which would reduce deficits by over
$4.8 trillion
(roughly $37,000 per household) while raising the federal debt limit. - On Monday, both the
Congressional Budget Office
and the
Treasury Department
stated that the federal government could reach the debt limit as soon as June 1. This is earlier than previous projections, due to higher-than-expected budget deficits this year. - Later that day, the White House
announced
that President Joe Biden will meet with congressional leaders next Tuesday to discuss the debt limit. This marks a reversal of Bidenâs previous refusal to negotiate, which included ignoring pleas from
Sen. Joe Manchin, D-W.V.
, and centrist
House Democrats
that the president work with lawmakers across the aisle.
All parties involved agree that the ticking clock requires legislative action, although some important differences in priorities remain.
Reaching the debt limitâs so-called X date would disrupt federal operations, especially because the Treasury Department
has no plan
for how to prioritize payments within the vast array of federal agencies and programs. Some are concerned that the Treasury Department potentially could fail to make interest payments on the national debt, which likely would rattle financial markets.
Conservatives are focusing on the debt limit as an inflection point to address both ongoing and yet-to-come economic crises. Persistently
high inflation
, driven by massive
federal deficits
and
spending
, is hammering families across the country.
Major programs such as Social Security are on a
fast track to bankruptcy
, meaning that deficits and resultant inflationary pressure will get worse in the future unless Congress acts soon.
Although the meeting scheduled for Tuesday at the White House presents the possibility of opening bipartisan negotiations over pairing a debt limit increase with badly needed fiscal reforms, Americans have reasons to be skeptical that Biden and Senate Majority Leader Chuck Schumer, D-N.Y., are acting in good faith. Among them:
1. Biden and Schumer immediately were dismissive of House Republicansâ Limit, Save, Grow Act. Although it isnât surprising that a legislative package packed with policies favored by conservatives would get opposition from Democrats, both Biden and Schumer grounded their objections in insistence that the debt limit increase be âcleanââthat is, without accompanying spending reductions.
This insistence ignores the fact that many bipartisan
deficit reduction deals
have been paired with the debt limit over the years and that such reforms primarily happen when prompted by the debt limit. Thereâs no reason why Congress canât do the same thing again.
2. Beyond objecting to the deficit reduction package in general, leading Democrats have used misleading claims to demagogue House Republicansâ proposed reduction to annual spending levels. Republicans seek to reduce appropriated spending to fiscal year 2022 levels, which would result in Congress needing to prioritize how to spend within that lower amount.
Unfortunately, Democrats now claim that lowering the top-line amount would automatically cut
veteransâ care
,
rail safety
, and more. This is simply not how the
annual spending process
works, since Congress still would need to decide how funds are allocated and could channel funds toward these and other needs that the American people rightly consider top priorities. Republicans have been
adamant
that veterans will not face cuts in benefits, and Congress has
hundreds of ways
to reduce spending without damaging core federal responsibilities.
On top of this, Democrats claim that priorities such as care for veterans would face a 22% cut, but such statements are based on
bad math
.
3. Schumer is
demanding
that any increase in the debt limit extend until December 2024, as opposed to the House package extension until spring 2024. Schumer knows that Congress has a bad habit of passing bloated
omnibus spending packages
(âChristmas treesâ) at the end of the year, especially after an election.
Such packages often are paired with naughty surprises such as debt limit hikes and special interest handouts, because lawmakers assume that the public will be too busy with holiday plans to notice the trickery.
We can expect more heated rhetoric before the two sides meet Tuesday at the White House, and there is no telling what (if anything) the discussion will produce. Democrats will keep up a steady drumbeat of demands that House Speaker Kevin McCarthy, R-Calif., fold and allow the national debt to continue its meteoric rise without any policy reforms. However,
polls show
that the public wants Biden to compromise and agree to bring down
excessive spending
.
Itâs vital for congressional Republicans to stand their ground. Rather than sending America barreling down the road of
unlimited debt
and continual economic instability, Washington must tap the brakes on runaway spending with a long-overdue attempt at real budgeting.
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This article originally appeared in the Daily Signal and is reprinted with kind permission from the Heritage Foundation.
