Congress is headed for a showdown. The vote on whether to raise the debt ceiling will be a turning point for the country, and the stakes are high.
Today, 40 cents of every dollar the federal government spends is borrowed — much of it from foreign nations whose interests are not our own. The national debt exceeds $14 trillion, which translates to roughly $50,000 for every man, woman, and child in America. Under President Obama — in just two years — our deficit has increased 132 percent, and our national debt 43 percent.
One need not look far to realize the ultimate destination, if we continue on this path. Right now, the economy of Greece is crumbling, and the people are rioting in the streets, because the government could not get its spending and debt under control.
“America is not Greece,” reply the defenders of President Obama’s massive spending, and our economy can handle our debt as smaller economies cannot. Yet just a few months ago — ominously, and for the first time in modern history — Standard and Poor’s signaled that U.S. debt may have to be downgraded, because, like Greece, our spending exceeds what we can afford.
Hence the fight over the debt limit. Congress should hold the line, and demand serious fiscal reforms before any possibility of a debt increase.
But, come the Cassandra cries of Treasury Secretary Tim Geithner, not raising the debt limit risks a default on our national debt. Nonsense.
Interest on the national debt comprises 11 percent of our annual budget, roughly $20 billion per month. Actual revenues are approximately $200 billion each month — significantly less than our annual spending, but far more than the costs to service our debt each month.
If the debt ceiling is not increased, the Treasury can — and should — continue to honor our debt in perpetuity. Instead of a default, what will be required is a substantial decrease in government spending (akin to a government “shutdown”) until the issue is resolved.
President Obama’s scare tactics, warning of a debt default and a global economic meltdown, are not productive. Instead, the president should listen to the voice of the people — expressed overwhelmingly at the ballot box in 2010.
Voters, quite rightly, are fed up with politicians spending more than we can afford, constantly expanding the size and power of the federal government. Voters instead want a return to limited government that lives within our means, protects our liberty, and honors the Constitution.
As a candidate for Senate, I have signed Senator DeMint’s Cut-Cap-Balance pledge, and I urge other candidates and current members of Congress to do the same.
The most important part of that pledge is the third element — not to raise the debt ceiling until Congress passes (not proposes, but actually passes) a strong balanced-budget amendment, which would include (1) a constitutional requirement that the budget be balanced, (2) a supermajority requirement to raise taxes, and (3) a spending cap, tied to a fixed percentage of GDP.
Right now, with Tea Party sentiments in the air, many politicians are expressing a desire to cut federal spending. But there will come a Pharaoh who knows not Joseph and his children — when the popular unrest subsides, establishment Republicans will once again join with Democrats in perpetually voting to expand the size of the federal government. To prevent that, as Thomas Jefferson admonished, we need to “bind [them] down from mischief by the chains of the Constitution.”
Indeed, Jefferson addressed directly our present crisis: “We shall consider ourselves unauthorized to saddle posterity with our debts, and morally bound to pay them ourselves; and consequently within what may be deemed the period of a generation, or the life [expectancy] of the majority.”
Jefferson was right. And now is the time for real leadership, to significantly reduce government spending, to eliminate our national deficit and debt, and to protect future generations of Americans.
— Ted Cruz is a former solicitor general of Texas and a Republican candidate for U.S. Senate from Texas.