The Budget Resolution Should Reduce, Not Increase, the National Debt
For Immediate Release
The House Budget Committee is currently working on a fiscal year 2018 Congressional budget resolution. While the budget will include a full tax and spending plan for the next decade, only some parts of the budget are enforceable and meaningful – specifically, the first year discretionary spending numbers and any reconciliation instructions.
The Committee for a Responsible Federal Budget believes these actionable components of the budget resolution must call for significant deficit reduction and not allow for deficit-financed tax cuts or spending increases. Specifically, the budget resolution should use reconciliation for substantial mandatory savings and for tax reform that reduces or at least does not add to the debt.
Maya MacGuineas, president of the Committee for a Responsible Federal Budget, said the following:
Fiscal goals are important, and it is laudable that this budget is trying to reach balance. However, to be credible, the budget must include serious proposals that will be enacted and not include gimmicks that mask the problem and take us backward.
We strongly support Chairman Black’s efforts to use reconciliation instructions to require mandatory savings from various committees, and finding $200 billion shouldn’t be controversial given that the budget will depend on trillions of dollars of spending cuts to reach balance. In fact, we encourage lawmakers to consider more savings, not less.
On the tax side, reform should be at least revenue neutral compared to current law and not resort to using a current policy baseline as a means of slipping in hundreds of billions of dollars in unpaid-for tax cuts. Using a current policy baseline could allow lawmakers to add over half a trillion dollars to the debt.
If the budget assumes tax reform is neutral from a current policy baseline and includes new upfront discretionary spending, as reported, it could add $2 or $3 to the debt for every $1 of mandatory savings. That would be fiscally irresponsible and unacceptable.
Finally, lawmakers should produce a budget that doesn’t resort to using gimmicks such as using Overseas Contingency Operations as a slush fund to funnel more money to defense or relying on unrealistic economic growth assumptions to wish away the deficit.
For years, Republicans have called for a budget that reaches balance. With debt at near record levels, achieving a reasonable fiscal goal is critically important and Congress should pass a gimmick-free budget that credibly sets the country on a sound fiscal path. That will require real, significant savings and tax reform that improves the fiscal outlook.
For more information contact Patrick Newton, Press Secretary, at email@example.com.