Swift action on the federal debt limit is necessary but may not be as easy as many on Capitol Hill assume, according to Robert L. Bixby, executive director of The Concord Coalition.
“Like Frankenstein’s monster, the statutory debt limit will soon come back to life,” he writes in a new blog post. Bixby calls for creation of a Debt Limit Reform Commission to come up with a way to tie the nation’s debt to an economically relevant standard such as the growth rate of the economy.
“Reform should also align debt limit increases with the policy decisions that require more borrowing.,” Bixby says.
The October budget deal suspended the debt limit through this Friday, when the Treasury Department -- unless Congress takes prompt action -- will need to begin using temporary measures to avoid a federal default for a few weeks. But Republicans say they will seek concessions while Democrats want no strings attached to a debt limit increase.
“It might get resolved without a crisis this time, but the risk is still there and will return whenever the debt limit needs to be raised again,” Bixby says. “If we truly want to move beyond episodic crisis management and back to rational budgeting we should recognize that the debt limit has itself become part of the problem.”
The Concord Coalition is a nonpartisan, grassroots organization dedicated to fiscal responsibility. Since 1992, Concord has worked to educate the public about the causes and consequences of the federal deficit and debt, and to develop realistic solutions for sustainable budgets. For more fiscal news and analysis, visit concordcoalition.org and follow us on Twitter: @ConcordC