The recent downgrade of the U.S. debt rating, and the massive market sell-off that it triggered, serve as a reminder that there is no substitute for thoughtful and responsible representatives in Congress.
We need members who understand the real nature of the problems we face, and act the long-term best interests of the people they serve – rather than out of rigid ideology or partisan self-interest.
Digging ourselves out from underneath this massive debt first requires an understanding how we got there. While both parties share some responsibility for our federal debt, the situation is far from symmetric:
- When the Republicans assumed power in 2001 our government was running a surplus and the debt was projected to be paid down to zero by the end of 2008. If Clinton-era policies had been left in place, the saved surplus (negative debt) today would have been $2.2T and growing. (see below)
- Republican policies turned the surplus into a deficit within months. These misguided policies included wars that were not paid for, massive entitlement increases without matching tax increases, and poorly structured tax cuts that increased debt but only produced jobs offshore. A financial meltdown was triggered by failure of Republican regulatory, monetary, and fiscal policy. By the time President Bush left office, today’s debt had changed from a projected Surplus of $2.2T to a Debt of $8.5T … a breathtaking swing of $10.7 Trillion dollars (the Republican Debt) that is still accumulating today.
- Since President Obama assumed office, additional debt of approximately $1.7T has been incurred. While much of this is a result of emergency measures to deal with the financial collapse, it represents real debt and a plan must be worked out to repaid. In Congress, Bill Foster voted against his party’s budget every time it has come up — not because he did not support necessary emergency measures to rescue our economy, but because it did not offer an adequate long-term plan to begin paying down our national debt.
THE WAY FORWARD ON OUR NATIONAL DEBT
The loss of the United States’ AAA credit rating – and the trillion-dollar market sell-off that resulted – would have been avoided if agreement had been reached on a “grand bargain” to reduce our deficits. President Obama’s Bipartisan Deficit Commission produced such a plan.
At its heart was a compromise that reduced debt by $4T using a mixture of 75% spending cuts and 25% tax increases. A similar compromise by President Reagan relied on 75% Tax increases and 25% spending cuts.
This compromise approach was supported by the majority of Americans. So why did it not happen?
The short answer is that ideological anti-tax pledges signed by a majority of Republicans – including every member of the Illinois delegation – meant they had pledged to refuse to negotiate or compromise. In a situation where 85% of our national debt is due to Republican policies, this will lead to disaster.
The Republican Debt clock is ticking.
Source: Bill Foster