grimm
03-04-2005, 09:58 PM
http://www.newsday.com/news/opinion/ny-vpg...rials-headlines (http://www.newsday.com/news/opinion/ny-vpgre044164335mar04,0,4305766.story?coll=ny-editorials-headlines)
Deficits just can't continue
Greenspan wants pay-as-you-go
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March 4, 2005
So now you've heard it from Alan Greenspan, the nation's pre-eminent economic soothsayer: Federal budget deficits are unsustainable and over time will "cast an ever-larger shadow over the growth of living standards."
In less measured language, that means unless President George W. Bush and the Congress stop cutting taxes and spending money like drunken sailors, they will so undermine the economy that Americans should no longer expect to live better tomorrow than they do today.
In his statement Wednesday before the House Budget Committee, the federal reserve chairman made no direct mention of Bush's pledge to cut the deficit in half by 2009. But it doesn't take much reading between the lines to surmise that he appears to put little stock in the president's promise. The reality is, Bush is not on a course to halve the deficit.
Washington can't afford to make the president's multi-trillion-dollar tax cuts permanent, as Bush wants. And it can't afford to continue accepting the budget gimmicks Bush is so fond of - keeping the cost of the war in Iraq off the books, for instance - while racking up record deficits.
Congress should heed Greenspan's pitch for a return to the pay-as-you-go budget rules that expired in 2002. That's the very year that the budget plunged back into deficit after four years in the black - and Washington has been wallowing in red ink ever since.
The concept is as simple as it is key. Under the rules, if Congress increased spending or cut taxes, then the cost to the treasury would have to be offset by other spending cuts or tax increases. Bush says he wants to return to that tough fiscal discipline but he insists it should not apply to tax cuts. That's fiscal discipline in name only and a sure formula for more deficits.
In trying to sell the nation on the notion that Social Security is in crisis, Bush has said repeatedly that the program will be bankrupt in 2042 because starting then, it will be obligated to pay out more money than it takes in. There is more than a bit of sophistry in that assertion. But if you accept the president's logic on Social Security, then the federal government, which spent $412 billion more last year than it collected in taxes, is bankrupt now and has been practically from the day Bush took control of the purse strings. You can argue about the rhetoric but there's no denying Washington needs to get serious about balancing the books.
Deficits just can't continue
Greenspan wants pay-as-you-go
Email this story
Printer friendly format
March 4, 2005
So now you've heard it from Alan Greenspan, the nation's pre-eminent economic soothsayer: Federal budget deficits are unsustainable and over time will "cast an ever-larger shadow over the growth of living standards."
In less measured language, that means unless President George W. Bush and the Congress stop cutting taxes and spending money like drunken sailors, they will so undermine the economy that Americans should no longer expect to live better tomorrow than they do today.
In his statement Wednesday before the House Budget Committee, the federal reserve chairman made no direct mention of Bush's pledge to cut the deficit in half by 2009. But it doesn't take much reading between the lines to surmise that he appears to put little stock in the president's promise. The reality is, Bush is not on a course to halve the deficit.
Washington can't afford to make the president's multi-trillion-dollar tax cuts permanent, as Bush wants. And it can't afford to continue accepting the budget gimmicks Bush is so fond of - keeping the cost of the war in Iraq off the books, for instance - while racking up record deficits.
Congress should heed Greenspan's pitch for a return to the pay-as-you-go budget rules that expired in 2002. That's the very year that the budget plunged back into deficit after four years in the black - and Washington has been wallowing in red ink ever since.
The concept is as simple as it is key. Under the rules, if Congress increased spending or cut taxes, then the cost to the treasury would have to be offset by other spending cuts or tax increases. Bush says he wants to return to that tough fiscal discipline but he insists it should not apply to tax cuts. That's fiscal discipline in name only and a sure formula for more deficits.
In trying to sell the nation on the notion that Social Security is in crisis, Bush has said repeatedly that the program will be bankrupt in 2042 because starting then, it will be obligated to pay out more money than it takes in. There is more than a bit of sophistry in that assertion. But if you accept the president's logic on Social Security, then the federal government, which spent $412 billion more last year than it collected in taxes, is bankrupt now and has been practically from the day Bush took control of the purse strings. You can argue about the rhetoric but there's no denying Washington needs to get serious about balancing the books.