The big news is the deal reached to extend the debt ceiling. That politicians reached a deal amongst themselves to extend the nation’s credit so they can borrow and spend more money should not come as a surprise, nor should the fact that the deal, being spun as a so-called win for the Tea Party, offers no real solutions to the nation’s fiscal woes. This is why credit agencies are indicating that a downgrade is coming despite the presence of a deal.
The deal contained $900 billion in Washington-style cuts, which means they’re spread out over 10 years and aren’t real cuts anyway. Instead, the politicians have agreed to increase spending slightly less than they otherwise hoped to. It also includes a provision for a “Supercommittee” formed with the task of identifying another $1.5 trillion in deficit reduction. Such promises for future cuts come cheap, and it’s a distinct possibility that the committee will include tax increases in its work.
So what should Washington have done? Honestly, folks, this isn’t exactly rocket science. The Center for Freedom and Prosperity has for several years described both the problems we face and how to fix them, and now seems like a good time to reiterate this material for the hardheaded members of the political class.
This first video explains the source of Washington’s problem: spending.
This spending problem was exacerbated by ill-conceived stimulus plans and a government takeover of health-care, both of which CF&P warned would never work, but would increase red ink.
But there are real solutions available to this Washington manufactured mess. The budget can be balanced without raising tax if politicians would simply take a lesson in spending restraint from America’s past, or that of other nations which have successfully reduced the burdens of government at one time or another, as explained by these two videos.
