Eric Cantor weighed in today at Quora on the balanced budget Amendment. This is what he said:
Once created, government programs build constituencies of special interests determined to keep the money flowing, whether or not the particular program is effective. There have been many times when the House has placed wasteful and duplicative programs on the chopping block, only to see pressure from the spending lobby win the day in the Senate.
Near-term spending cuts are necessary to alter the course, but they will not be enough without long-term changes. Likewise, promises of cuts 10 years from now mean little without a way to enforce them. The only way to truly guarantee delivery from future elected officials is for the Constitution to demand it.
To that end, the House has scheduled a vote on a balanced budget amendment that would require supermajorities in both chambers to run a deficit, raise the debt ceiling, raise taxes and spend more than 18% of the GDP. With the balanced budget movement gaining momentum, members of the spending lobby want to argue that Congress and the President already have the ability to control spending. Ability and discipline are not the same. If Washington actually had the discipline to live within its means over the long-term, every American citizen would not owe $46,000 toward the national debt.
In my view, the importance of these upcoming votes cannot be overstated. The adoption of a Balanced Budget Amendment would make reckless borrowing a thing of the past, and will ensure that our children enjoy futures full of opportunity.
Democrats and Republicans should join together to do the right thing, pass this amendment, and make a real difference for the future of our country.
This is the old, false, Government is like a household shtick, limited in its revenue to what it can raise from taxing, and borrowing,with the further claim, that we as individuals owe the national debt, even though it is the Government and not ourselves that contracted to pay back the principal and interest on it. I replied to his comment at Quora in this way (plus a bit of editing below):
As usual you’re talking nonsense. The level of debt subject to the limit or the level of the debt-to-GDP ratio, have nothing to do with the ability of the US Government to pay its debts because the US has a non-convertible fiat currency with a floating exchange rate and no debts in any foreign currency. Since it is the currency issuer it can always pay its debts by creating new money which it does now through the interaction of the Fed and the Treasury.
However, if you don’t believe this, a fact admitted by Greenspan and Bernanke, and the debt bothers you so much, then please pay it off this way, and avoid both higher taxes and harmful spending reductions as well. Of course, spending will still exceed tax revenues, but who will care if the Government pays for the difference without additional taxing or issuing new debt?
Btw, every American does not owe $46,000 for the debt. It’s the Government that contracted the debt, and it’s the Government that owes it. This is a good thing, because you, and I, and very other American are not currency issuers like our Federal Government and so, cannot repay every debt we incur regardless of its size. But, again, the Federal Government can do that.
That’s one very important difference between it, on the one hand, and our households, our corporations, our non-profits, and our State and local Governments, on the other. All are currency users limited in their spending in the end by their income and outgo of a limited supply of currency and reserves.
However, our founders wisely created our nation as a currency issuer. And now, you propose to diminish our sovereignty, by stupidly amending one of their prime achievements. You should be ashamed of yourself, along with all the other Federal office holders who serve corporate and wealthy interests at the expense of this nation and 99% of the American people!
Meanwhile Jack Trammell, the lucky Democrat who benefited from Cantor losing the Republican primary, has decided to run on the same myths about households and balanced budgets that Cantor is supporting at Quora — show once again, that the austerity idiocy besetting much of the nation, is shared by candidates on both sides of the Party duopoly. What’s a voter who wants to vote for someone not buying into any further real fiscal irresponsibility, nay, fiscal insanity, to do?