The House of Representatives took the correct path a few weeks ago when it voted to cut spending by $111 billion for fiscal year 2012 and to cap spending in future years at a gradually smaller share of the economy. "Cut, cap and balance" is an excellent specific plan -- in contrast to President Barack Obama, who did not present one -- to address what is a spending problem and not a "revenue problem," as most Democrats proclaim.
Do you find it interesting that the nation has talked about the debt ceiling for the past year? We have known about the possible increase. However, we have passed a stimulus bill for $1 trillion that has had little effect. We have yet to see a budget from the president and now we are supposedly on a cliff and those who say let them jump are the ones being irresponsible. Go figure.
By the way, in reflecting on the debt ceiling debate and on my years in Congress, we've always had some try to cure everything from health care to poverty through more spending. But if prices and taxes continue going through the roof, they're sure to cure wealth.
Passing President Obama's initial proposal for a $1 trillion tax increase first, with a promise of "tax reform"¨ and "cuts" later, would be irresponsible. Americans should be outraged at the spectacle of the nation's debt rising above $14 trillion. Former President George W. Bush isn't responsible for that number. Remember that it is this president, with a complicit Democrat Congress, who greatly increased our debt by pushing through the largest tax increase since 1993 -- President Obama's health care law.
The president talked about vague spending cuts to entitlements in return for congressional tax increases and upping the debt limit. Yet he didn't want to address the huge spending and tax increases that will be driven by the gradual implementation of his new health care plan. As The Wall Street Journal recently underscored, the new $1 trillion-plus health care law adds more than 30 million more Americans onto Medicaid's rolls, when that program is already growing by 6.5 percent this year. "So Obama is willing to cut current entitlements on grounds they are unaffordable, but he's taken what may be the most expensive entitlement off the table," the paper editorialized.
As for raising the debt ceiling -- again -- I have been through this debate before in Congress. As a senator, the president even voted against raising the ceiling. So why aren't Democrats in Congress paying more attention now to our unsustainable mountain of debt? It is predicted by 2014 it will equal a whopping two-thirds of Gross Domestic Product. This is a historic crisis facing the president and Congress. Look no further than the financial ruin facing Greece, Ireland, Portugal, Spain and other countries suffering because of out-of-control tax-and-spend policies.
Debt Commission Co-Chairman Erskine Bowles says the current interest on the federal debt is about $200 billion and is projected to grow a $1 trillion in 10 years. In terms of government spending, he says, "Pretty soon you have no money left for anything else." This ultimately means we won't have the necessary money to fund our military and project our power -- which plays right into the hands of our foreign enemies.
Average Americans will pay more in taxes and fees, we won't have money to fix our highways and bridges, we will pay higher rates in trying to buy homes and cars, and Pell Grants that college students rely on will be no more. Debt and deficits impact our everyday lives and the bigger they are the more taxes and fees they will require Joe Six-pack to pay for growth. That's why the commission recommended at least hundreds of billions in spending cuts now. And that's what Republicans were trying to accomplish during the White House-GOP showdown.
Think about this: There is no such thing as government money. The only way the government can get money is to tax your personal income, tax your company's income, put a government fee on something you use or vote to borrow it. Even if they borrow it, they will pay it back with the other three ways they get money.
This is why I believe Republicans should hang tough in getting serious spending reductions.
By law, 49 states have to produce balanced budgets, why not the federal government? Ideally, the Congress should pass a balanced budget amendment that includes a strong provision requiring a two-thirds supermajority vote to increase taxes. We've got to protect us from ourselves. Under this president, however, such an amendment would be vetoed assuming it could pass Congress.
As Las Vegas CEO Steve Wynn notes, business people are sitting on their money "out of fear of the president." And they will continue to do so, he says, because of his "weird°" fiscal politics. I must say, from health care to economic policy, they have been quite strange.
J.C. Watts (JCWatts01@jcwatts.com), chairman of J.C. Watts Companies, a business consulting group, is former chairman of the Republican Conference of the U.S. House, where he served as an Oklahoma representative from 1995 to 2002. He writes twice monthly for the Review-Journal.