Contact: Anna Oman, 202-234-8494

--For immediate release--

Sadly, Vote to Increase Debt Limit Saw No Real Debate
Statement of Adam Hughes, Director of Federal Fiscal Policy, OMB Watch
March 17, 2006

Yesterday the Senate voted 52-48 to increase the statutory debt limit once again. The limit now sits at $9 trillion. The vote to increase the debt limit was necessary in order to avoid a government default, yet Senate Republican leaders pushed hard for this vote to take place without proper debate and without giving Senators a chance to offer amendments, some of which could potentially help to slow the rapid run-up of debt in years to come.

This increase marks the fourth time Congress has needed to increase the debt limit in the five years since President Bush took office, ushering in a debt that has ballooned by more than 51 percent over that time. The vote highlights the abysmal record for both the President and Congress. At the start of the Bush administration--when the national debt was $5.95 trillion and large surpluses were projected for the government--Bush told Congress and America we could afford tremendous tax cuts, while paying down the debt. This turned out to be an utter miscalculation, and the days of surpluses are now long gone. Instead of pursuing the endeavors and investments that would have been possible for the country pre-tax cuts, we are confronted with mountains of debt. At the same time, Congress seems more concerned with managing the political fallout of raising the debt ceiling again than with actually debating how to fix the problem.

The need to increase the debt limit yet again is a direct result of the fiscal policies and practices implemented by Bush and Congress over the past five years. While the administration blames the increase in U.S. debt on both the 2001 recession and the costs of the war on terrorism, in reality the cost of his 2001 and 2003 tax cuts, ringing in at $225 billion in 2005 alone, carry far more of the blame for the burgeoning rise in national debt.

Democrats demanded as much as eight hours of debate and up to three separate amendments to the debt limit legislation, but Senate GOP leaders preferred to try to ignore the problem and avoid a much-needed public discussion on the causes and solutions to our current and growing debt troubles. In the end only one amendment was considered which sought a Treasury Department study on foreign investment in the United States.

Frist blocked Democrat attempts to offer another amendment on pay-as-you-go rules (PAYGO) that would have been an excellent first step toward stemming the irresponsible fiscal policy of this Congress and president. Democrats have offered the PAYGO amendment on several recent occasions, twice last fall and once this week. All three times it has been rejected by razor thin margins, with all but a handful of Republicans voting against it, leading many to question if the GOP has abandoned its fiscally conservative roots. Clearly, far too many Republican Senators felt fine burdening future generations with hundreds of billions of dollars of new debt every year, dampening future economic prospects, and threatening economic security, for the nation.

Unfortunately, Republican leaders were not willing to take even the smallest step to redirect the nation's course toward sound and sustainable fiscal policy. And while the GOP is turning a blind eye, they continue plodding through their work, seemingly oblivious to the results of their actions. Nothing illustrates this more plainly than the yesterday's adoption in the Senate of the FY 2007 budget resolution that will add an additional $684 billion to the government's debt next year.

If lawmakers continue to enact budget and tax legislation in the same irresponsible fashion that has marked the last five years, the debt will continue to explode. Even without factoring in the cost of the Iraq war and annual fixes to the Alternative Minimum Tax, the total national debt under current policy is expected to reach $11.5 trillion at the end of 2011, or twice that of the debt inherited by Bush when he took office.

Allowing this level of debt is both unfair and irresponsible. Every single U.S. citizen now carries $28,000 of national debt burden, and this number will dramatically increase unless Congress makes some real changes to current fiscal policies. At a minimum, Senators and Representatives should be having real conversations and debate about what is wrong with current budget and tax policies and how to fix them.

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