Tuesday, October 15, 2013

Not Raising the Debt Limit Equals a Balanced Budget

Richard Ebeling, with a very  important proposal that won't shrink government but at least will stop it from growing, emails:

Dear Bob,

I have a new opinion article today on the news site, "EpicTimes," on "Not Raising the Debt Limit Equals a Balanced Budget."

I argue that not raising the debt limit would require the federal government to only spend what it takes in as tax revenues, in other words, a balanced Budget.

While this would necessitate the government to make some hard choices, given that government spending has far exceeded collected taxes via deficit funding, it would not require a debt default, or a failure to pay Social Security or Medicare payments. The government will take in more than $3 trillion in its fiscal year, 2014, and debt payments will be less than $300 billion during that period, leaving more than enough do cover a lot of what the government has been spending on.

But it will require politicians and the voting public to do what they do in their private lives -- make hard choices when their income in less than their desired purchases. It will force taxpayers to rethink what exacting it is they want government to do and how much they are willing to pay in higher taxes to get it without deficit spending.

This would make government financing more transparent, and assure that the debt burden would not get worse for ourselves and our children to have to pay off some day.


1 comment:

  1. Professor Ebeling offers a rational point of view, that a child of two could understand. Prior to savaging commodity money, and later paper clippings backed by commodity, govt. had to live by spending what they confiscated via taxation. Once they discovered they could dramatically increase their power-purview by the use of debt, it was off to the races, and never looking back. But the Piper may be closer than they think, even if as expected they once again 'raise the debt limit.'