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An Open Letter to the United States Congress: Pass Cut, Cap and Balance to Avert Fiscal Calamity!
July 18, 2011
Dear Member of Congress:
On behalf of the 362,000 members of the National Taxpayers Union (NTU), I urge you to support H.R. 2560, the “Cut, Cap and Balance Act.” Introduced by Reps. Chaffetz (R-UT), Mulvaney (R-SC) and Ribble (R-WI), this bill embodies the general principles of the Cut, Cap and Balance coalition by cutting $111 billion in spending next year, enacting a statutory cap on expenditures, and allowing for a $2.4 trillion increase in the debt ceiling that would only go into effect if Congress passes and submits a Balanced Budget Amendment to the states for ratification.
Regardless of the political lens through which the trajectory of federal spending and debt is viewed, the current fiscal course is clearly unsustainable. Washington’s profligate spending habits have led to a deficit of roughly $1.6 trillion this year, a figure about equal, in inflation adjusted terms, to the entire federal budget of 1982. These annual imbalances are quickly pushing debt as a share of Gross Domestic Product to dangerous levels. Under its most realistic policy scenario, the Congressional Budget Office predicts that debt held by the public will exceed 100 percent of GDP by 2021, will speed past its historical peak of 109 percent by 2023, and would approach 190 percent by 2035.
Credit rating agencies have taken note of this fiscal recklessness. Moody’s Investors Service has threatened to downgrade our current “AAA” rating “unless substantial and credible agreement is achieved on a budget that includes long-term deficit reduction.” Likewise, Standard & Poors has said that to maintain our credit rating policymakers must not only prevent a “near-term default” but also must “materially improve” our debt situation for the years ahead.
The Cut, Cap and Balance Act is the comprehensive solution necessary to maintain America’s sterling bond rating and enable our economy to return to prosperity. This approach combines immediate, modest program cuts, a statutory spending cap to reduce spending nearer to historical norms within the next several years, and a robust Balanced Budget Amendment to keep deficits under control for the long haul. These structural changes provide the necessary framework to put an end to Washington’s obstinacy and ensure the long-overdue adjustments to expenditures are finally made. In doing so, this bill eschews the stance taken by other debt limit plans to prioritize electoral calculations over substantive policy changes to reduce future pressures for borrowing. Taxpayers are not interested in complex gimmickry, procedural ploys, or too-clever-by-half attempts to place blame; they demand real changes to Washington’s unsustainable budgetary habits.
NTU urges all Members of Congress to strongly support the Cut, Cap and Balance Act. Only through its budget-process reforms will we be able to stabilize and reduce the debt – which are the absolute preconditions for America to escape its’ economic woes. Roll call votes on H.R. 2560 will be among the most heavily-weighted of the year in our annual Rating of Congress.Sincerely, Brandon Greife Federal Government Affairs Manager