- The Washington Times - Monday, March 13, 2006

Treasury Secretary John Snow has been imploring Congress to pass a new debt ceiling in order to prevent the United States from defaulting on its obligations.

No wonder. Treasury reported Friday that the monthly budget deficit reached an all-time record in February. Last week, the House Appropriations Committee passed a $91 billion supplemental spending package for 2006, including $68 billion for the wars in Iraq and Afghanistan, which would push total funding for those conflicts above $400 billion. This week, the Senate will vote on its fiscal 2007 budget resolution, which projects a deficit of $359 billion, marking the fifth consecutive year that federal red ink will exceed $300 billion. Indeed, despite the fact that the economy likely will have grown by an average of 3.4 percent per year over the 2003-07 fiscal period, annual deficits will have averaged more than $375 billion during those five years.

No doubt congressional Democrats will extract the requisite pound of political flesh before the debt ceiling is raised. Republicans did the same during the Clinton administration. Ten years ago, when then-Treasury Secretary Robert Rubin engaged in several accounting maneuvers (recently repeated by Mr. Snow) while waiting for the Republican-controlled Congress to increase the debt ceiling, then-House Rules Committee Chairman Gerald Solomon actually raised the specter of impeaching Mr. Rubin. Then-House Majority Whip Tom DeLay accused Mr. Rubin of “looting the Social Security trust funds.”

Ten years ago this month, Congress raised the debt ceiling from $4.9 trillion to $5.5 trillion. In August 1997, three months after then-President Clinton and the Republican-controlled Congress reached their historic balanced-budget agreement, which soon generated unified-budget surpluses and significantly decelerated the increase in the gross federal debt, the debt ceiling was raised to $5.95 trillion. There it remained for nearly five years.

With the return of budget deficits, the debt ceiling has been successively raised to $6.4 trillion in June 2002, $7.4 trillion in May 2003 and $8.2 trillion in November 2004. In late 2005, the Republican-controlled House approved a $780 billion increase in the debt ceiling, lifting it to $9 trillion. That’s the likely target for the Senate this week.

But a debt ceiling of $9 trillion will not last long. The Bush administration’s 2007 budget projects a gross federal debt greater than $11.5 trillion by the end of fiscal 2011, reflecting a $5.9 trillion increase (more than 100 percent) since George W. Bush became president.


Copyright © 2018 The Washington Times, LLC. Click here for reprint permission.

The Washington Times Comment Policy

The Washington Times welcomes your comments on Spot.im, our third-party provider. Please read our Comment Policy before commenting.

 

Click to Read More and View Comments

Click to Hide