The debt ceiling compromise has passed. It is not “perfect.”
No legislation ever is. The Constitution was an amalgam of various negotiated principles, many with negative self-interested reasons, but it has proven to be the greatest document for self-governance the world over for over two centuries now and still counting ― hopefully.
The Committee for a Responsible Budget and the Congressional Budget Office (CBO) estimate the debt ceiling deal will reduce future spending by $2.1 trillion over the next decade. There are more than $250 billion in immediate budget savings due to 81 rescissions specified in the bill.
The last time one penny was saved due to any deal on Capitol Hill was 2011 ― one year after Republicans picked up 63 seats in Congress and forced a politically wounded President Obama to agree with their terms.
The Freedom Caucus was founded in 2015. They have not introduced or supported any legislation yet which was signed into law that saved any taxpayer money in any out-year. Even during President Trump’s first two years in the White House when Republicans controlled the Senate, Congress and the White House, no major legislation passed into law which reduced spending.
Seventy-one Republicans in the House voted against the debt ceiling deal, half of them Freedom Caucus members. They complained because it “didn’t cut as much spending” as the $4.2 trillion spending reduction package which passed in the House.
So what? This deal cut $2.1 trillion out of spending. That is better than nothing.
The only thing that counts in our constitutional democratic republic is what is in the final bill signed by the president into law. It doesn’t matter what is in any bill that comes out of the House or Senate. That is Basic Constitutional Principle No. 1.
In Texas, they call such posturing by Freedom Caucus members “all hat and no cattle.” No one should let the perfect be the enemy of the good when it comes to reducing the rates of growth in spending so we can, one day once again, balance the U.S. budget.
The key to achieving a successful “compromise” is to get as much as you want in a bill while letting the other side think they are getting what they want ― full well knowing they will not understand the real-world application and implementation of the policy in terms of economics, tax policy and business sense.
Conservatives were able to outsmart liberal Democrats in the 1990 Budget Agreement and the 1997 Budget Act, both of which went hand-in-hand to balance four consecutive budgets from 1998-2001.
If Republicans really wanted to balance the budget, they should consider giving liberal Democrats what they “really” want in the following (somewhat preposterous) example.
Democrats love class warfare. They love to “stick it to rich people and corporations.” Republicans should give it to them as part of a “Grand Bargain” in the following way:
In return for holding overall spending growth to 3% per year ― which would balance the budget all by itself by 2035 ― include a provision to tax 31 wealthy corporations and individuals $1 trillion apiece, which would be used to eliminate our $31 trillion national debt. The $600 billion saved in interest costs can be designated to satisfy some other social welfare goal Democrats might have with the proviso “if the national debt is fully retired.”
The left will jump all over that — $600 billion is a lot of your money they want to spend on government programs.
It is like catnip to them.
Uber-wealthy trillionaires will find a way to avoid paying any of the proposed tax hikes just as they have found ways to avoid paying exorbitant taxes in the past. The debt will not be paid off; the interest will not be saved and the liberals will not have $600 billion of your money to play with ― but the budget will be balanced by 2035 for sure.
The uber-left ― who don’t understand economics, tax law or business common sense ― won’t even know they had been hornswoggled until long after the fact.
Republicans will have achieved what they said they have always wanted to do, which is to balance the budget without any new taxes ― taxes which are never paid are “no new taxes,” correct?
If the Freedom Caucus members really want to cut spending, they will use their creativity and cleverness to come up with a package that even Democrats will support.
It is just a matter of knowing how to outmaneuver an opponent.