Saturday, December 25, 2010

Hopeful and sensible rhetoric from the Republicans

When Washington talks about paying for something, it usually means raising taxes, but it isn't necessarily so. You can 'pay for' new spending by cutting current spending.
To prevent deficit reduction from being used as an excuse for tax hikes, Republicans are getting rid of the “Pay-As-You-Go” rule and replacing it with a “Cut-As-You-Go” rule.

The rule will require that any legislation that seeks to increase mandatory spending (which is spending that once added to the federal budget recurs year after year and is thus permanent) cuts spending by a similar amount.

“If it is your intention to create a new government program, you must also terminate or reduce spending on an existing government program of equal or greater size–in the very same bill,” said Rep. John Boehner, the Ohio Republican who will become Speaker of the House on Jan. 5.
But holding the line won't bring down the debt, unless the economy starts to grow and revenues increase. That will be the big test. Can Congress resist the impulse to spend new revenue rather than retiring debt. The message of the 2010 elections was to reduce spending and back away from big entitlements and big regulations. Even if the Republicans hold the line, they only have the power now to block efforts from the left to advance the progressive agenda, not necessarily to force rollbacks. That is the goal, and largely the hardest problem we still face.

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