With Washington's budget showdown over – for now, at least – attention has shifted to the next major government funding crisis on the horizon. With a mere $80 billion between the government and default, lawmakers, lobbyists, and Obama officials are scrambling to make the case for an extended line of credit.
But just as with the budget negotiations, the newbies (along with some staid veterans like Jim DeMint) are making trouble. Those pesky, pie-eyed congressmen that ran on promises of slashing spending and reducing government bloat are questioning the wisdom of taking on more debt as the first step toward balancing our nation's budget.
The adherents of voodoo economics insist, however, that it's not that simple. Failure to increase the debt ceiling, they maintain, will wreak economic havoc around the globe and undermine the fragile "recovery" that is underway here at home (This message is brought to you by the proponents of TARP and "too big to fail"!). From the Washington Post:
"If Congress does not increase the limit, borrowed funds would not be available to pay bills and the United States may be forced to default on its debt obligations. There's no precedent for this situation. Treasury has never been unable to make payments as a result of reaching the debt limit. With a fragile global recovery counting on U.S. economic stability, the debt limit issue could roil international financial markets. Democrats and Republicans agree that if the debt limit is not raised we would be inviting economic catastrophe."
There's no denying that America has gotten itself into a hole the size of the Grand Canyon, and any way we slice it, getting out again is going to be a painful, even "calamitous" process. The question is, should we face this inevitable calamity now, or are we going to take the coward's way out and leave the mess for the next generation of Americans to address?
The prevailing assumption seems to be that we can bail, borrow, and print our way out of this mess – that somehow, we can find a way to evade the consequences of our profligacy and fiscal fecklessness. Biting the bullet and facing up to the reality of the situation is not something our leaders seem prepared to do. Time and again, we hear politicians bewail the sluggish state of the economy, terrified that for the first time in generations our children may not exceed their parents' standard of living. In order to avoid this unimaginable fate, they conclude, government is morally obligated to do everything in its power to keep the train of progress and prosperity moving forward, even if it means mortgaging the very futures of the children we are so desperate to protect.
The American people made it clear in the last election that they are ready for true leadership on the debt and deficit issue. They don't want the rhetoric or logic that brought us the bailouts. They don't want more of the same lame excuses and convoluted logic. They want their representatives to make the hard decisions and do the work they've been elected to do. They want the government to cut spending and live within its means. If that's going to prove painful, the people who got us into this fix (us!) should have to live with the consequences – not our children and grandchildren. And if the recent Libertarian trend among well-educated young people is any indication, our children will not stand idly by much longer while their parents and grandparents pursue fatal policies guaranteed to make us a nation of indentured servants.
The American people will soon find out if the newly elected reformers on Capitol Hill have the gumption to stick to their guns when it really matters. Heaven help us if politics prevail as usual, and nothing is done to stop this fiscal runaway train. The time for talking is quickly running out. We need decisive action, and we need it now.