Debt Ceiling Trade Must Include Structural Spending Reforms

If you’vewatched the NBA playoffs you know Dirk Nowitzki is a star. A power forward capableof putting an entire team on his back and single handedly carrying them to the thresholdof a championship. What you likely don’t know, or at least don’t remember, isthat Nowitzki is only a Maverick as the result of one of the most lopsidedtrades in NBA history. In 1998 Nowitzki was traded by the Milwaukee Bucks forRobert Traylor. You’re likely asking, who? Exactly. Traylor was a man betterknown for his nickname (Tractor) than his pro-game. And that’s why it’s one ofthe worst trades ever done.

And yet Republicansstand ready to top it. House and Senate leadership have indicatedthat in exchange for raising the country’s $14.3 trillion debt ceiling theywant $2.5 trillion in spending cuts. It is an ask so low that Club for GrowthPresident Chris Chocola called it “an inadequate trade for raising the debtceiling [because] spending cuts alone won’t last – they never do.”

Since thebeginning of the debt limit debate, NTU has echoedthat call, pushing for the enactment of long-overdue structural reformsthat will prevent a crisis. As NTU President Duane Parde has asked,“What good is increasing the debt ceiling if nothing is done to curb thereckless spending that will perpetually test any limit on borrowing, no matterhow high?

While thecuts proposed by Republican leadership must be part of any agreement toincrease the debt ceiling, the enormity of our problems demands more. Of keyimportance to the debate should be a balanced budget amendment (BBA) to theconstitution. To their credit, a group of eight Republican Senators sent a letterto Dick Durbin, Chairman of the Constitution, Civil Rights, and Human RightsSubcommittee, urging him to hold hearings on S.J.Res. 10, which would create aBBA that would limit annual spending to 18 percent of gross domestic product.

In calling forstructural changes, the letter serves as a reminder of the severity of the fiscalcrisis we face:

“The national debt,now over $14 trillion, has increased more than one-third since January 2009.The Congressional Budget Office (CBO) estimates the deficit for the currentfiscal year will be approximately $1.4 trillion and the national debt will soonbe larger than the economy. . .

Undoubtedly,Washington has a spending problem and this problem is getting worse. The budgetdeficit is now almost fifteen times the size it was when the Senate came withinone vote of passing a balanced budget amendment in 1997.”

Without a comprehensive strategy,such as “Cut,Cap, and Balance,” a plan proposed by the Republican Study Committee whichincludes a balanced budget amendment, statutory spending caps, as well asspending cuts, the United States’ deficit will continue to explode.

So as Republicans continue theirnegotiations with Democrats over the debt limit, we urge them to demand morethan simple spending cuts in a trade for raising the debt ceiling. To not onlyavert a near-term fiscal crisis, but permanently solve our deficit woes,structural change, in the form of a BBA and statutory caps are needed. Anythingless and Republicans will find themselves like the Milwaukee Bucks, wonderinghow they let their best hope slip right through their fingers.