The New York Times tried turning the screws on Republican members of Congress who are adamant about President Joe Biden agreeing to spending cuts before the debt ceiling is raised … yet again.
Times White House correspondent Jim Tankersley wrote in the sub-headline of his anti-GOP propaganda March 7 that “a top economist will warn lawmakers that Republicans’ refusal to raise the nation’s borrowing cap could put millions out of work.” The “economist” was none other than Hillary Clinton donor and “registered Democrat” Moody’s Analytics Chief Economist Mark Zandi. Tankersley wielded Zandi to claim that “The U.S. economy could quickly shed a million jobs and fall into recession if lawmakers fail to raise the nation’s borrowing limit before the federal government exhausts its ability to pay its bills on time.” But if Biden agrees to the GOP calls for spending cuts to offset a debt ceiling increase, editorialized Tankersley, there would be “stark economic damage.” Uh, what?
Of course, Tankersley didn’t mention that Zandi was one of two economists in 2020 who absurdly “argued that a total Democratic sweep [in the elections] would bring the biggest boost to the economy because of Biden’s plans to spend trillions on infrastructure, education and the social safety net while boosting trade and immigration.” It was such a “boost” that it propelled the U.S. into a bitter inflation crisis. Tankersley continued propping up Zandi’s claims to editorialize that the spending cuts needed to “balance the budget” would lead to “stark economic damage if Mr. Biden, in an attempt to avert a default, agrees to those demands.” Did Tankersley forget the “economic damage” that’s already been done as a result of Biden and company’s obsession with spending? [Emphasis added.]
But Tankersley, ignoring Zandi’s abysmal track record, railed that the GOP playing hardball on spending cuts would lead to “damage [that] could spiral to seven million jobs lost and a 2008-style financial crisis in the event of a prolonged breach of the debt limit.”
MRC Business spoke with Hillsdale College Economics Professor Gary Wolfram to get the real story on what’s at stake if the debt ceiling continues to be raised indefinitely without addressing out-of-control spending that is causing the national debt to balloon well over $31 trillion. Wolfram noted that the debt ceiling “has been used as a mechanism to limit increases in federal government spending and federal debt.” But, as Wolfram told MRC Business, the debt limit increased “78 times under both Republican and Democratic presidents” since 1960. Wolfram argued that the federal debt cannot continue to be swept under the rug. “[T]his must be addressed,” said Wolfram. “The focus on increasing the debt limit can serve as a forum to further the analysis of the problem.”
In Wolfram’s analysis, focus must be placed on addressing mandatory spending:
[D]eficit spending and increases in the debt cannot be addressed without dealing with what is known as mandatory spending. This is spending that occurs even if the annual appropriations bill is not enacted.
“Mandatory spending,” which includes Social Security, Medicare and Medicaid, has gone from “28% of the federal budget in 1965 to 70% of the federal budget today,” according to Wolfram. He analyzed that if one were to eliminate all the spending in the appropriations bill other than defense spending and interest on the national debt from fiscal year 2022, the situation is so bad that mandatory spending obligations meant “you would still have run a deficit of nearly $500 billion.” Apparently this was lost on Tankersley.
Secondly, per Wolfram, “is that James Buchanan and Richard Wagner back in 1977 in the book, Democracy in Deficit, explained how federal government deficit spending leads people to believe that government programs are cheaper than they actually are.” Zandi reportedly told The Times that “he favored eliminating the statutory debt limit entirely to end the threats that a potential default poses to the economy. ‘I just think you want to break that cycle once and for all as best you can, because it’s very counterproductive’” he said. Wolfram challenged Zandi’s view. Given that the budget has been balanced only four years since 1969 (FY 98-FY 2001), according to Wolfram, “it is time that we address the problem of massive government deficits and debt and simply eliminating the debt ceiling is not likely to accomplish this.” [Emphasis added.]
Conservatives are under attack. Contact The New York Times at 800-698-4637 and demand it stop propping up out-of-control government spending.