March 06, 2004

What happened to PayGo?

In 1990, as part of the Budget Enforcement Act there was enacted a 'pay as you go' (PAYGO) principle which required that all enacted direct spending and tax legislation for a fiscal year must be deficit-neutral. Basically, if you wanted to increase school spending, you needed to cut somewhere else. If you wanted to give a tax cut, you needed to cut somewhere else.

No, there were some exceptions made for 'emergency spending', which was probably over-used. However, the concept was a good one - not only for encourage fiscal responsibility, but also for exposing the priorities of our elected officials. If you wanted to give Corporate America a tax cut at the expense of homeless shelters, it was obvious.

The Paygo clause was extended several times, the last one through 2002. Then it was killed - both the house and senate passed HR 5708 which, in a matter of a few lines, wiped all that away.

Upon the enactment of this Act, the Director of the Office of Management and Budget shall reduce any balances of direct spending and receipts legislation for all fiscal years under section 252 of the Balanced Budget and Emergency Deficit Control Act of 1985 to zero.

No, this was sold, mostly, as a way of protecting Medicare. (That was a lie ). It was passed by the Republican controlled House and Senate, and signed by the Republican President.

I think Representative Price said it best:

Today's vote represents a fork in the road of Federal budgeting. We must decide whether to continue down the path of deeper budget deficits or to take those first difficult steps toward returning to a balanced budget.

Now more than ever, it is essential that we reaffirm our commitment to the budget tools that can help us restore budget discipline and return the Federal Government to a balanced budget. That is why I am disappointed that the Republican leadership has decided to bring to the floor legislation that would eliminate PAYGO sequestration for all future years to which the law applies.

The Republican solution, that we ignore the long-term budget deficits facing our Nation, will not make them go away. We should not ignore our budget problems; we should work to solve them.

Comments:
Posted by Henry at 10:26 AM || Link to me || Category:: Politics, Just Left on