The Truth in Budgeting
Winston Churchill once said, “The truth is incontrovertible. Malice may attack it, ignorance may deride it, but in the end; there it is.” Here’s the incontrovertible truth about budget deficits: Spending is still out of control.
The national debt is now more than $15 trillion. The budget deficit for this fiscal year alone will be more than $1 trillion. This mountain of debt is a growing obstacle to economic recovery. But for many in Washington, it’s business as usual.
The same budget gimmicks are being used to frustrate attempts to rein in spending. We cannot restore financial responsibility to Washington until we put an end to dishonest budgeting. That’s why I have joined 20 senators in co-sponsoring the Honest Budget Act, to outlaw nine accounting tricks commonly used to hide unnecessary spending.
Here are a few examples:
- Follow a budget. Parents – who can afford to – use allowances to teach their children life lessons, like the importance of budgeting for essentials. Congress, however, hasn’t approved an annual budget in nearly three years. Is it any wonder that we’ve had the three largest annual budget deficits in history?
- Take down the Christmas tree. This isn’t to spoil the holiday season; it’s to halt adding tens of billions of dollars in pet projects to emergency spending bills. Congress sometimes needs to make special appropriations to cover unanticipated costs – military operations or natural disaster aid. This should be limited to true emergencies only.
- Outlaw budgetary shell games. One budget game played most often is shifting funds – from one year to another, from one account to another – to frustrate accurate counting. What it adds up to is more deficit spending.
- A $15 trillion national debt is scary, but taxpayers also are on the hook for hundreds of billions in high-risk loans and federal guarantees, like the open-ended bailout for Fannie Mae and Freddie Mac. Loan guarantees can be useful ways to stretch private-sector investment dollars for the public good. But transparency and proper reserves are imperative. A loan with no realistic possibility of full repayment isn’t an asset; it’s a liability. Accountability and honest accounting matter.
In total, the budgetary gimmicks covered by our bill have added $350 billion to the nation’s debt since 2005. We – and our children – most likely will be paying interest on this for decades. Our nine reforms would require accurate accounting. They could put an end to the budgetary game-playing and prevent hundreds of billions of dollars of unnecessary and unauthorized spending.
Washington remains divided over starkly different visions of the proper role of government and the best approach for re-energizing our economy. This continuing debate may not be resolved until the national elections in 2012.
But our bill advances principles that Republicans, Democrats and independents can all agree on: accountability, honesty and transparency in spending taxpayers’ money.
These reforms are long overdue.
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