RSC Debt Limit Plan: Cut, Cap, and Balance
Here is a cap and trade plan we can support.
The political world has been waiting with alacrity to hear the details of the GOP demand for raising the debt ceiling. The Republican Study Committee is wasting no time in publicizing their overarching condition for raising the debt ceiling; lowering the spending floor. You might think of it as the preeminent ‘cap and trade’ program.
We have long railed against an incremental approach to the battle for limited government and spending cuts. The reality is that Republicans don’t have the requisite political power to statutorily roll back big government policies through the front door. They probably won’t for some time. Consequently, their only recourse to impel meaningful and perennial change is to use the budget process to force the issue.
Republicans will have the opportunity to deny the issuance of any more debt as the debt limit fight reaches its crescendo towards the end of the spring. In September, they will have another opportunity to force the Democrats’ hand by refusing to budge from the fundamentals of their FY 2012 budget, even if the Democrats threaten to shut down the government. Yes, even with control of “just one half of one third of government,” the GOP can prevail in a budget fight with the support of the public.
The RSC is proposing a three-pronged plan that would attack all of the pressure points of the big government beast.
1. Implement immediate spending cuts for FY 2012 that would reduce the deficit by 50%, roughly $700 billion from this year’s estimated $1.4 trillion deficit. Accounting for roughly $320 billion in expected revenue gains from growing tax receipts, they would propose roughly $380 billion in spending cuts to achieve that goal.
2. Impose permanent statutory spending caps to reduce federal spending to 18% of GDP, providing for automatic spending reductions if caps are breached.
The specific details of the caps and spending cuts will be unveiled next week. For now, the RSC is wisely pursuing a broad approach that would erect an impervious ceiling on the growth of government. We all know that any proposal will get watered down during negotiations. Therefore, we must come out swinging with sweeping demands at the incipient stages of negotiations. Otherwise, we will wind up with nothing.
The RSC is circulating a letter to John Boehner and Eric Cantor detailing their terms for raising the debt limit. They are also collecting signatures from their 176 members (or any other member of Congress). Please call your congressmen and request that they buttress their rhetoric regarding spending cuts and government reform with bold action. Tell them to support the RSC stipulations for real spending cuts and caps.
Make them promise to trade their vote only on condition that government is capped and the spending floor is lowered.