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The Illusions of Pay-GO

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Washington, Jul 29, 2010 | comments

When Democrats claimed the congressional Majority in the 110th Congress, the House Leadership promptly installed a “pay-as-you-go” rule they pledged would ensure “no more deficit spending.” When President Obama signed a pay-as-you-go statute in February this year, he declared: “Now, Congress will have to pay for what it spends, just like everybody else.”

In whatever form, however, pay-as-you-go has failed to prevent an explosion of deficit spending over the past 3½ years; and when enforced, the rule has mainly driven higher taxes to chase higher spending. Here are some of the results:

  • Since the start of the Democratic congressional Majorities in January 2007, the deficit has widened nearly 10-fold, from $160 billion to $1.5 trillion this year, and deficits will total $9.8 trillion over the next 10 years, according to the Congressional Budget Office.

  • So far during the 111th Congress, the President and Democratic Majority have enacted more than $1.6 trillion in 10-year deficit increases under pay-go, using various methods to hide the red ink and claim they were “paying for” their spending binge.

  • They also have increased spending by $1.4 trillion over 10 years, and used pay-as-you-go to raise taxes by $447.3 billion.

  • In addition, the House has passed numerous other deficit- or tax-increasing bills that are awaiting further action.


View the full report here.

 

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Tags: PAYGO