For months, President Obama’s administration demanded a clean increase in the government’s $14.3 trillion debt limit ceiling with no conditions attached. Despite a $1.4 trillion deficit for 2011 and the unsustainable fiscal trajectory we are now on, administration officials want to continue massive deficit spending. They have shrilly argued that failure to increase the debt limit, almost immediately upon reaching it, will result in a catastrophic default on America’s debt.
The administration is right that defaulting on our debt would be catastrophic. But its insistence that a delay in raising the debt limit will cause a default on our debt is a calculated political maneuver designed to intimidate Republicans into raising the debt limit with no meaningful spending cuts or process reforms.
The truth is, the federal government collects more than 10 times the tax revenue needed to service its debt, and the Treasury has the authority to prioritize federal spending. So, even absent a hike in the debt ceiling, we will not default on our debt. Just to take the possibility of default completely off the table, I have introduced legislation requiring the Treasury to make debt service its top priority.
Let me be clear: I support raising the debt limit provided the increase is accompanied by serious spending cuts and structural spending reforms — such as spending caps and a balanced budget amendment. I have always acknowledged that a delay in raising the debt limit would cause a disruptive, partial government shutdown, which is best avoided. However, a disruptive shutdown is not the same as a catastrophic default.
And there is something worse than a temporary disruption of some government services. That is signaling to the world that we lack the political courage to correct the biggest challenge facing our nation today: our unsustainable deficits.
The most irresponsible thing Congress could do is to continue on the reckless path of excessive borrowing and spending. Since the administration shows no interest in curbing its spending appetite willingly, we should force the concessions by making our support for a higher debt limit contingent on restoring fiscal prudence. We do not have the luxury of postponing the tough choices for another day.
Read more: http://www.usatoday.com/news/opinion/editorials/2011-07-10-opposing-view-debt-ceiling_n.htm