Just as I have repeatedly predicted since the last debt-ceiling debate, statists are already gearing up for another lifting of the debt ceiling. A good example comes in a New York Times editorial, which is already trying to pressure Republicans into lifting the new debt ceiling when it comes due, which is expected to happen soon after the November elections.
Suppose the New York Times editorial board was asked the following question: Is there some total amount of government debt that the board would consider so high that it should not be exceeded?
How would the NYT editorial board respond?
For example, according to the U.S. National Debt Clock, right now the total national debt is about $15.7 trillion. Each citizen’s share of this debt is $50,278. If you have a family of four, your share of the debt is $200,000. That’s how much you and your family would have to pay if the government sought to pay off its debts by collecting every person’s share of the debt through taxation.
What would the NYT editorial board say?
One possibility is that it would say, “No, there is no amount of debt that could ever be considered too high. The government can and should continue piling on as much debt as it wants. If it goes to $30 trillion or $100 trillion, no big deal. If each citizen’s share rises to $400,000 or $1 million, so be it.”
It would be difficult to believe, however, that even the NYT would not have an upward limit on the amount of debt that the government should not be permitted to exceed.
So, most likely, the NYT editorial board would respond, “Yes, there is an amount of debt that would be so high that it should not be exceeded. That amount is $xxxx.”
Well, guess what. That’s what the debt ceiling is all about. It’s a determination that the total amount of debt that the government should be allowed to incur has been incurred. It might not be the same amount that the NYT editorial board would settle on, but it is the amount that the elected representatives of the American people have settled on.
By setting the debt ceiling, Congress is effectively saying, “There is an upward limit on the amount of debt that the government should incur, and that upward limit is $xxxxx. The government is prohibited from exceeding that amount of debt.”
Do you remember what happened last time the debt ceiling was reached? Libertarians were saying, “A ceiling is a ceiling. The total amount of allowable debt has now been reached. No more debt.” Some Republicans were openly exclaiming that they would not raise the ceiling because, again, the total amount of allowable debt had been reached.
But the statists went ballistic. They began predicting that the sky would fall if the government wasn’t permitted to continue incurring more debt and piling it on the backs of the American people. They ended up putting so much pressure on Republicans that most Republicans caved in at the last minute and voted to lift the debt ceiling.
Of course, the whole scenario was a repeat of previous times that the debt ceiling had been reached. Each time the ceiling would be reached, the statists screamed that the world would end if the ceiling wasn’t raised and the Republicans dutifully caved in to the pressure.
After the debt ceiling was raised the last time, did you see the statists calling for reductions in spending? Wouldn’t you have expected them to say, “Look, we got by the last time by raising the debt ceiling but now we have to slash spending because we’re looking at another debt ceiling in a couple of years from now. If we don’t slash spending, the government is going to have to continue borrowing and borrowing.”?
Well, that’s not what the statists did. Instead they laughed, knowing that their strategy could be employed again and again and again. They knew that all they would have to do is scare people into thinking that the world would end if the debt ceiling wasn’t lifted and then just go on forever with higher and higher debt being incurred.
Of course, the statist hope is to “grow the economy.” What that means is that they’re hoping that enough people get to work so that they can pay the taxes needed to fund the welfare state and the warfare state without the government’s having to slash spending.
As everyone knows, the welfare statists are absolutely opposed to cutting welfare-state spending and the warfare statists are absolutely opposed to cutting warfare-state spending.
And we also know that the total amount of tax revenues to cover all this spending continues to fall woefully short of the total amount being spent. That means that government officials have to keep borrowing and borrowing to cover the difference. It also means that the debt ceiling — i.e., the total amount of debt that the government should be permitted to incur is rapidly approaching.
Of course, the statists continue thinking that all they have to do is raise taxes or, even better, tax “the rich.” But statists are in a jam. The welfare-warfare state has reached a point where the more they tax, the more the system begins to implode in on itself. That’s what’s happened in Greece. If they raise taxes to fund the welfare state, more businesses go out of business, leaving an ever-shrinking pie to tax to fund the ever-burgeoning welfare state.
Moreover, many of the rich are now leaving the United States, giving up their citizenship. Not surprisingly, this is earning them the ire and enmity of the statists. They think that those rich people who leave the United States are horrible for not staying here and letting the IRS confiscate their wealth to fund the welfare-warfare state. Some of the statists are so angry that they even want to prohibit rich Americans who give up their citizenship from returning to the United States to visit.
Why can’t statists just admit that the gig is up? Why can’t they acknowledge that the welfare-state, warfare-state way of life has been nothing but a massive, expensive failure? America should no more have embraced such welfare-state programs as Social Security, Medicare, farm subsidies, and foreign aid than it should have embraced the Cold War, the Vietnam War, foreign empire and interventionism, the military-industrial complex, and the national security state.
Not surprisingly, the chickens are now coming home to roost. Americans are faced with a choice: Do we permit the government to continue piling on ever-increasing debt on us or do we instead dismantle (i.e., repeal, not reform) all the welfare-state and warfare-state programs and restore sound money and a fiscally responsible government to our land? Or to put it another way: Do we continue to travel down the road to bankruptcy and moral debauchery, as the statists want, or do we change directions and restore a free and prosperous society to our land?