WASHINGTON, D.C. — Today, U.S. Representative David Schweikert (AZ-01) authored an op-ed for RealClearMarkets.com asserting that the United States cannot afford to simply raise the debt ceiling without exercising fiscal restraint and communicating to world debt markets that the country has a plan to manage its debt. Additionally, Rep. Schweikert unequivocally stated that the United States will never default on its debt and urged the White House and Congressional Democrats to work with House Republicans to address the nation’s long-term fiscal challenges.
Simply Raising the Debt Ceiling Won’t Solve Our Fiscal Challenges
It must be unequivocally stated that the United States will never default on its debt. Republicans will never allow this to happen. We simply will not subject the American people to catastrophic repercussions here at home and around the globe.
Americans crave and deserve the truth from their government officials. The truth is that our nation is on a fiscal path that is simply not sustainable.
In 2011, Standard & Poor’s lowered the long-term U.S. credit rating to AA+ because the fiscal consolidation plan negotiated between the White House and Congress fell short of what they viewed “would be necessary to stabilize the government’s medium-term debt dynamics.” In simpler words, we didn’t communicate to the markets that we had a credible plan to manage our debt. Back then, the share of the debt held by the public was $9.7 trillion. Today, that number exceeds a whopping $24 trillion, a 147% increase, and it continues to grow.
Simply increasing the debt limit without at least starting the process to put our fiscal house in order would be irresponsible and unacceptable. Future generations deserve better.
Two weeks ago, House Republicans took action to responsibly raise the debt ceiling, reduce government spending, and grow our economy. But President Biden and Congressional Democrats are playing politics rather than seriously negotiating to save our nation from the brink of default. The hypocrisy of my brothers and sisters across the aisle is astounding.
It wasn’t that long ago when Nancy Pelosi and Chuck Schumer used the debt ceiling vote to extract billions in additional spending in a deal with the prior administration when it was raised in 2017 and again in 2019.
The truth is, the Left would rather hold our economy hostage and make the threat of default a campaign issue than work with Republicans to find bipartisan solutions that exercise fiscal restraint while allowing our country to pay its bills on time. The closer we get to Treasury’s June cut-off date, the more we risk severe consequences for our nation’s fiscal health.
Last year, the U.S. government borrowed over $40,000 every second, according to Joint Economic Committee calculations. Creditors want to be assured that the U.S. will pay them back. Raising the debt ceiling without any fiscal restraint signals to creditors that the U.S. has no intention of stabilizing its debt, calling into question our credit rating once more.
But it isn’t just financial markets we must keep our promises to. We must uphold all our commitments to the American people.
Take, for instance, Social Security. According to the Congressional Budget Office, the Social Security Trust Fund runs out in nine years, which would trigger an automatic 24% cut to recipients’ scheduled benefits. Are we really going to let senior poverty double in the name of partisan bickering?
Even as debt ceiling negotiations progress, our country’s economic outlook continues to look bleak. CBO’s latest budget outlook estimates that the federal budget deficit will reach $1.5 trillion this year – a 9% increase since the last report was issued in February.
Over the next decade, deficits grow from 6 percent of GDP to 6.9 percent, and debt held by the public increases from 98 percent of GDP this year to 119 percent in 2033. This is plainly unsustainable.
CBO’s budget review for April revealed that the deficit for the first seven months of Fiscal Year 2023 is $928 billion, a 236% increase from 2022. And when we desperately needed a strong showing in tax receipts to keep pace with soaring spending levels, we learned that these revenues are down 10% – a substantial disappointment considering total federal spending is up 12% for this fiscal year to date. Not to mention we are heading toward borrowing $2 trillion a year on interest alone.
We’ve reached the point where we can no longer play politics with our nation’s fiscal health. It’s time for Republicans and Democrats to come together to be open and honest about our nation’s fiscal challenges. That is our moral obligation to the communities we serve.
If we want to gain the trust of the American people, we must stop the posturing, tell them the truth, and be candid and willing to admit when we are wrong. We must demonstrate that we are capable of sitting down and acting like adults when negotiating fiscal discipline. The future of our nation depends on it.