Summer Sale Extended! Get unlimited digital access for 13 weeks for $13.
Op-Eds
News Opinion Op-Eds

McConnell: Time for tough choices on spending, debt

Over the next several weeks, Republicans in Washington will be engaged in a critical mission: to persuade Democrats of the need to develop a plan that reins in our debt without raising taxes, which we know would kill jobs. This effort is taking place in the context of President Barack Obama's request to raise the nation's debt limit, and early indications suggest that many Democrats still need some convincing.

The key to success, in my view, is for everyone involved to view the debt limit vote as an opportunity — an opportunity to reduce Washington spending now and to save taxpayers trillions of dollars over the long term. It is also an opportunity to prevent the fiscal crisis that we all see coming, a crisis that would devastate jobs, trigger a massive foreclosure crisis and delay the economic recovery even more.

In other words, reluctant Democrats need to realize very soon that this is no mere academic or ideological debate. A failure to rein in our nation's debt would have painful and far-reaching consequences for every single American. This is why I have insisted that failing to make tough choices now poses a far greater threat to our nation's long-term prosperity than failing to raise the debt limit.

In the short term, we know that continued reluctance to lower the debt without raising taxes is hindering job creation. One study suggests that any nation carrying a debt at or above 90 percent of its economy loses one point of economic growth, which some argue is equivalent to 1 million jobs.

Washington-driven uncertainty is also inhibiting job creation. Right now, U.S. businesses are sitting on nearly $2 trillion in cash. Most would love to invest it in new products and ventures, and yet they're holding back. Why? New and proposed regulations, the unknown costs of last year's health care bill, and the widespread expectation of tax hikes tomorrow to pay for spending binges today are a big part of it. Investment follows certainty, and that's one thing this White House refuses to provide.

But another reason job creators are holding back is the uncertainty surrounding our fiscal future. Right now, Washington is borrowing roughly $4 billion every day above what it collects in taxes, more than $600 million of which goes to the interest on our debt. This troubling addiction to credit has created a situation in which nearly half our debt is held by foreign countries. If just one of them doubts our ability to repay — and the greater the debt, the likelier this is — economic calamity could swiftly ensue.

Scenarios like these seemed far-fetched just a few years ago, but the fiscal landscape has changed rapidly under Democratic control. True, both parties have contributed to a culture of overspending. Yet in just two years under President Obama, the nation's debt has skyrocketed 35 percent, from $10.6 trillion to $14.2 trillion; the annual deficit is more than three times the largest annual deficit ever recorded before his presidency, and the nation's debt is expected to keep rising year after year, as far as the eye can see.

Democratic refusal to get these deficits under control through spending cuts and entitlement reform is one reason the rating agency Standard and Poor's recently threatened to downgrade U.S. debt, and why Moody's Investor Services, which threatened a downgrade of U.S. debt earlier this month, also sees the ongoing debt limit talks as an opportunity for the parties to come together and avert a looming crisis.

Given the impact that our nation's debt has on jobs in the short term and on our nation's prosperity and success in the long term, it should not be difficult to convince lawmakers of the need for immediate action. Yet as recently as a few weeks ago, Senate Majority Leader Harry Reid was still calling for a so-called "clean" vote on the debt limit that would leave the status quo on spending and debt intact. Too many Democrats still seem to think they can just wait this crisis out, in the hopes it will go away.

Still, a consensus appears to be emerging around the Republican call to action. The president, who several months ago supported raising the debt limit without any corresponding cuts, recently directed Vice President Joe Biden to come up with a bipartisan plan to cut the deficits that he helped create. President Obama has also acknowledged in recent weeks the connection between getting our fiscal house in order and economic recovery. As he recently put it, "If we don't have a serious plan to tackle the debt and the deficit, that could actually end up being a bigger drag on the economy than anything else."

We shall see how serious the administration is about doing something truly significant. During past crises, President Obama has often seemed less interested in solving the problem than he was in giving a speech about it. But this is different. Unless we get our fiscal house in order soon, the consequences could be far more painful than some are willing to admit. The upcoming debt limit vote represents the best opportunity we have to keep that crisis at bay, foster the kind of job growth Americans desperately want, and put America back on a solid ground. Hopefully others will soon realize the time to act is now.

Mitch McConnell of Kentucky is Republican leader of the U.S. Senate. He can be reached through his website: http://mcconnell.senate.gov.

Copyright © 2015, The Baltimore Sun
Related Content
  • Republicans offering same failed economic policies

    The recent Republican debate was fascinating. How incredible that all the contenders wanted to discuss the economy, since it was a Republican administration that gave us the great recession of 2007. If there is one area of agreement among them, it is to continue the tax cuts for the wealthy and...

  • Less testing, more learning

    Less testing, more learning

    As our kids embark on another school year, they will experience and enjoy many of the same memorable projects and lessons we once learned. Parents and educators are excited to spark their curiosity and teach the important critical thinking skills that will help students grow and succeed.

  • Is Hillary 'likable enough'?

    Is Hillary 'likable enough'?

    Seven years ago, 2008 Democratic presidential candidate Sen. Hillary Clinton of New York, in a New Hampshire primary debate, was asked about her personal appeal. Her prime opponent, Sen. Barack Obama of Illinois, cheekily interjected: "You're likable enough, Hillary."

  • China's slowdown is good news for the U.S.

    China's slowdown is good news for the U.S.

    U.S. stocks have endured a lot of turmoil, but recent shocks have made apparent important facts about China and the shifting global economy long ignored by many analysts and investors. Those bode well for America and the bull market should soon resume.

  • The path forward for city schools

    The path forward for city schools

    It's the first day of school in Baltimore, and I'm feeling the excitement and optimism I always feel on this day of the year. But in my decades as a teacher, administrator and superintendent, I have never felt more urgency and concern on a first day than I do today.

  • Baltimore needs school choice

    Baltimore needs school choice

    Nearly a half-century after local and national uprisings around the passing of Rev. Martin Luther King Jr., what is the one aspect of the urban condition in Baltimore that has changed too little but can transform a person's life and livelihood, and ultimately his or her community?

  • The tragedy after Hurricane Katrina

    The tragedy after Hurricane Katrina

    After the storm waters of Hurricane Katrina subsided, devastation remained: unsafe and waterlogged structures, with moldy, crumbling walls; unsalvageable fridges and soggy couches; indoor rivulets of mud. Local economies collapsed. A million people were displaced. Thousands of residents lost everything...

  • Why does there have to be one black voice?

    Why does there have to be one black voice?

    A nonprofit booked me to speak to some young writers from Baltimore. "How does it feel to be the voice of the people?" a girl in square frames with a pumped fist asked. "I don't speak for all of Black America," I told her. "I'm not the voice of black Baltimore, or Down Da Hill, or Latrobe Projects...

Comments
Loading
84°