Not just a miserable failure, a profligate miserable failure.
Next week, before it leaves on its Saint Patrick’s Day recess, Congress has one bit of unpleasantness to attend to. It must raise the debt ceiling, the statutory limit on the amount of public debt the government may legally accumulate, for the fourth time in Bush’s presidency. We are over the debt limit right now, and the government has about run out of pension payments and other funds from which it can borrow to avoid having to default on payment obligations. The debt ceiling has to be raised again because the public debt has risen by an astounding 40% since George W. Bush took office.
Although resort to the accounting gimmicks used by Secretary Snow has been common, it should be noted that when Clinton’s treasury secretary, Robert Rubin, used such tactics in 1996, when Congress refused to raise the debt ceiling, Republican reaction was somewhat different.
Back then, some lawmakers in the Republican-controlled House of Representatives called for Rubin's impeachment, saying his action usurped the powers of Congress. But in 2002, when the Bush administration was about to hit the $5.95 trillion debt limit it inherited from President Bill Clinton, then-Treasury Secretary Paul O'Neill employed Rubin's tactic to buy time until Congress raised the debt ceiling to $6.4 trillion in June.
Alas, that limit lasted just 11 months. In May 2003, Congress authorized borrowing of $7.4 trillion. In November 2004, lawmakers upped the credit ante to $8.184 trillion. Now, Snow says the limit must be raised yet again to protect "the 'full faith and credit' of the United States."
The need to raise the debt ceiling for the fourth time in George Bush’s presidency is just the latest reminder of the incredible profiligacy of this Administration, something the Democrats hope to highlight when the matter comes up for a vote. By contrast, at the end of Bill Clinton’s last fiscal year (September, 2001) the cumulative U.S. public debt stood at $5.807 trillion. It had grown approximately $1.396 trillion during Clinton’s 8 years in office, less than the amount it grew during the one-term administration of the first George Bush. And lest we forget how this problem starte, when Ronald Reagan took office the debt ceiling was just $1 trillion.
Enter George W. Bush. In the four and a half years of the Bush Presidency, he and the Republican Congress have added $2.463 trillion to the debt, bringing it to almost $8,270,900,000, 000, an increase of 40% in less than five years. The current debt ceiling is $8.184 trillion. There is talk of raising it to $9.65 trillion, even though President Bush promised to halve the budget deficit (the yearly contribution to the cumulative debt) by one half by the time he leaves office. And the culprit?
The Iraq War, now costing $4-5 billion a month, is one factor. But the main factor is tax cuts, according to the Congressional Budget Office. In fact, last year the cost of Bush’s tax cuts was three times the increase in all domestic spending, including entitlements. And although the new Medicare drug benefit will raise spending this year, Congress is poised to enact yet more tax cuts.
That we spend more than we take in is the major cause of not only our staggering cumulative debt, but our trade imbalance as well. And it is the need to finance our public and private spending with foreign borrowing that has left the world awash in dollars that they increasingly want to convert to harder assets, such as U.S. companies. Continued profligacy will lead to more attempts by foreign entities to buy U.S. assets. With no interest in Washington in addressing the cumulative debt, the day of reckoning will eventually come, with a falling dollar, rising interest rates and a slowing economy, all of which will lower our living standards. But when is anyone's guess, and that is the crux of the problem.