Debt and Deficits

Bipartisan Senate Effort Predictably Kills Rand Paul's Plan to Balance the Federal Budget

Paul's proposal to cut 2 percent from the federal budget for the next five years was predictably opposed by both Democrats and most Republicans

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This year, Sen. Rand Paul's (R–Ky.) effort to balance the federal budget didn't even get a floor vote in the Republican-controlled Senate.

Paul's so-called "Pennies Plan" failed a procedural vote on Monday evening when only 22 senators voted in favor of a cloture motion that would have brought the bill to a final vote. A majority of Republicans and all Democrats voted against proceeding to a floor vote on the bill. It's another sign that fiscal responsibility is all but dead in Congress, even as the national debt heads toward record highs and the budget deficit approaches $1 trillion this year.

"We teach our children that money doesn't grow on trees, and then they grow up watching politicians pretend otherwise," Paul said before the vote. "Meanwhile, our debt soars past $22 trillion, endangers our country, and artificially limits what our nation can achieve."

Paul's proposal called for cutting 2 percent from the federal budget for each of the next five years and would reduce federal spending by about $11 trillion over the next decade—even though spending would rise after the first five years. It's an adaptation of the so-called "Penny Plan" that Paul has been pushing for several years, though he now says an additional penny in cuts for every federal dollar spent is necessary to get the budget to balance.

Indeed, the gap between what the federal government spends and what it takes in is growing wider. During the first seven months of the current fiscal year, which began in October 2018, the federal government ran a $531 billion deficit. That's a 38 percent increase over the same period of time last year.

According to an analysis from the nonpartisan Committee for a Responsible Federal Budget, about 60 percent of this year's expected deficit is the result of policies—mostly last year's huge increase in spending that shattered those Obama-era budget caps—put in place by current legislators and signed by the current president.

The share of debt held by the public currently stands at about 78 percent of gross domestic product (GDP), a shorthand measure of a country's economic output in a single year. The numbers are actually worse than that, because "debt held by the public" accounts for only $15.8 trillion of the $21 trillion national debt. The rest is held by parts of the federal government, such as the Social Security trust fund.

Alarm bells are starting to sound. The Government Accountability Office (GAO) warned in April that America's current fiscal situation is "unsustainable." The GAO estimates that the amount of debt held by the public is on track to surpass the all-time high of 106 percent of GDP within the next 13 to 20 years.

Meanwhile, Congress seems as apathetic as ever, if not more, about the growing pile of federal debt.

Most Republicans go back to their districts and say they support balanced budgets, Paul said on the Senate floor before the vote, "but they're not really for balanced budgets if they vote for budgets that don't balance."

Paul also took aim at Democrats, who he accused of pushing for pie-in-the-sky spending plans that promise everything from free college tuition to greater government spending on health care and retirement entitlements. Those proposals will add trillions of dollars to the national debt or will require massive tax hikes, Paul said.

"These proposals are ludicrous," said Paul. "We have so much debt from what we are already trying to give you, and these people want to double, triple, and quadruple that. It's a recipe for disaster."

Last year, Paul was able to get the balanced budget proposal to the Senate floor after striking a deal with Senate Majority Leader Mitch McConnell (R–Ky.) during an earlier budget impasse to get the bill on the floor. Paul called that vote a "litmus test for conservatives," and most of them failed it as the measure went down in flames, 76 to 21.

Before Monday's vote happened, Paul predicted that not a single Democrat would vote for his proposal and more than half the Republicans wouldn't vote for it either.

He was right.

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68 responses to “Bipartisan Senate Effort Predictably Kills Rand Paul's Plan to Balance the Federal Budget

  1. If there’s ever a future Edward Gibbon to chronicle the fall of the American Empire, this vote will figure prominently in his account.

    1. I wrote in Dr. Ron Paul for prez in 2008 & 2012….I wrote in Dr. Rand Paul in 2016 & will again in 2020!

      I will sleep peacefully at night knowing I did not contribute to America’s eventual collapse!

      1. The DEBT is not the DEFICIT. And the DEFICIT is not the DEBT. They are separate problems.

        Government BORROWING drives up the debt, not government SPENDING.

        The solution to our debt problem is simple: STOP ISSUING DEBT-BASED MONEY! Begin issuing pure “unbacked” fiat money to fund the deficit, rather than going further into debt. The inflationary impact of unbacked dollars is no worse than the inflationary impact of the same amount of debt-backed dollars. Issuing unbacked dollars will halt the increase in the national debt and its crushing $430 billion in annual interest. Paying off part of the maturing debt each year and rolling over the rest will eventually bring the national debt (and its taxpayer-financed interest payments) down to zero. See http://www.fixourmoney.com .

        1. The solution to our debt problem is simple: STOP ISSUING DEBT-BASED MONEY! Begin issuing pure “unbacked” fiat money to fund the deficit, rather than going further into debt

          “Begin”? That’s cute! The US has been doing both for decades. And both are used for political advantage by both parties.

          Issuing unbacked dollars will halt the increase in the national debt and its crushing $430 billion in annual interest.

          Yes, and it won’t happen, because a lot of politically powerful people depend on it.

          The good thing is: once you see through the fraud, you can prepare for its consequences.

  2. The Con Man is the GOP now and the Con Man doesn’t give a fuck about his record spending/deficits.

    1. Exactly, as the senate just confirmed.

    2. When was the last time a Republican president and Congress did?

      1. When W had a GOP House and Senate, the deficit went down each year, at least.

        1. Under Obama the deficit dropped six out of eight years. When he left it was about half of what it was when he took office.

          But the Republicans are the fiscal conservatives, Finrod?

          1. When Barry was POTUS, the total debt more than doubled in 8 years despite those declining deficits…

          2. Under Obama the deficit dropped six out of eight years

            The only reason the deficit “dropped six out of eight years” was because Obama jacked up the deficit to such massive levels in 2009; it had to come down. That wasn’t a sign of fiscal restraint, it was a consequence of the absurd spending levels in 2009.

            When he left it was about half of what it was when he took office.

            The deficit was about $500 billion in 2007; it was over $1 trillion throughout most of Obama’s administration and never went below the 2007 level.

            And most of that extra spending under Obama was crony capitalism: paying off rich donors and voting blocs.

            Your lies are not just absurd, they are offensive.

            1. Bullshit Factoid One : “The only reason the deficit “dropped six out of eight years” was because Obama jacked up the deficit to such massive levels in 2009; it had to come down.”

              The day of Obama’s first inauguration the projected deficit was 1.3 trillion. Obama didn’t “jack-up” anything.

              Bullshit Factoid Two : The deficit was about $500 billion in 2007; it was over $1 trillion throughout most of Obama’s administration and never went below the 2007 level.

              All you need to do is look below to expose that lie.

              Bullshit Factoid Three : And most of that extra spending under Obama was crony capitalism: paying off rich donors and voting blocs.

              Do you even take your crap seriously? No one else does. Do you?

          3. There was a trillion dollar stimulus that accomplished nothing when he took office.

        2. George W Bush, deficit hero ?!? From Clinton’s last budget to Bush’s first was a delta of 286 billion dollars in one year’s additional debt. Bush’s best year – deficit wise – was still 289 billions dollars worse than the surpluses he inherited.

          That’s what happen’s when you pass multi-trillion dollar tax cuts paid for by magic unicorn fairy dust promises they pay for themselves.

          DJT : FY 2019 – $1.092 trillion
          DJT : FY 2018 – $779 billion

          BHO : FY 2017 – $665 billion.
          BHO : FY 2016 – $585 billion.
          BHO : FY 2015 – $441 billion.
          BHO : FY 2014 – $485 billion.
          BHO : FY 2013 – $680 billion.
          BHO : FY 2012 – $1.077 trillion.
          BHO : FY 2011 – $1.299 trillion.
          BHO : FY 2010 – $1.294 trillion.

          GWB : FY 2009 – $1.413 trillion
          GWB : FY 2008 – $459 billion
          GWB : FY 2007 – $161 billion.
          GWB : FY 2006 – $248 billion.
          GWB : FY 2005 – $318 billion.
          GWB : FY 2004 – $413 billion.
          GWB : FY 2003 – $378 billion.
          GWB : FY 2002 – $158 billion.

          WJC : FY 2001 – $128 billion surplus
          WJC : FY 2000 – $236 billion surplus
          WJC : FY 1999 – $125 billion surplus
          WJC : FY 1998 – $69 billion surplus
          WJC : FY 1997 – $22 billion
          WJC : FY 1996 – $108 billion
          WJC : FY 1995 – $164 billion
          WJC : FY 1994 – $203 billion
          WJC : FY 1993 – $255 billion

          1. There were no surpluses under Clinton. If you doubt me check the national debt under Clinton – it went UP every year of his admin.

            Spending too much is he problem, not taxing too little…

          2. FY 2009 was signed by BHO, not GWB. It reflected BHO’s spending priorities, including the bailouts, which BHO had the final say over.

            Furthermore, your numbers are not reflective of the actual debt increases, which are even larger under BHO than your list suggests; there seems to have been some creative accounting there.

            1. It’s funny when progs talk shit about republicans and deficits only to be far worse. If we cleansed our country of regressive, then we could finally force republicans to show some fiscal responsibility.

              1. Here’s what’s “funny” :

                (1) Republican Reagan inherited a small deficit from Carter and buried the country in debt.

                (2) Republican GHW Bush inherited a bad situation made it worse.

                (3) Democrat Clinton inherited deficits and left surplus.

                (4) Republican GW Bush inherited surpluses and buried the country in debt.

                (5) Democrat Obama inherited plus-trillion dollar deficits and cut them in half.

                (6) Republican Trump almost doubled the deficit in only two years.

                Notice the trend? Every time a Republican takes office he makes the deficit much worse. Every time a Democrat takes office he cleans up after the fiscally irresponsible mess he inherited, making the deficit much better, It’s now been that way for almost a half-century : Republicans make things worse; Democrats make them better.

    3. So we should vote for the party openly asking to double government spending?

      1. If you don’t vote for the lizards, the wrong lizard might get in,

        1. +1 Rutherford the Brave

      2. Which is worse, the thief or the lying thief?

        My opinion: In a better world the answer would be, “Neither, vote third party.” Unfortunately practicing what I preach in 2016 had severe consequences. Since everyone else simply can’t help but vote for thieves, what option is there but to go with the ‘honest’ thieves?

    4. >>>The Con Man is the GOP now

      as though two parties exist.

    5. BOTH SIDES ARE THE CON MEN!!!

    6. Hey PB, taking a break from kiddie porn long enough to spread your lies and venom?

    7. Fiscal responsibility is a losing proposition for most candidates. Too many vote as spoiled children treating the government as their parents/guardians except they get to vote for the ones that say yes to all the toys and candy.

  3. Please commit this to memory and tell all others about it when we go down the proverbial tubes. How much more before this is worth shooting over?

      1. Yuh huh

      2. Replies are closed.

  4. GOP is pathetic

    1. Half pathetic.

      Meanwhile the Democrats are 100% insane.

    2. True, true. They are also wimps and lack a political program or agenda. And when they get power, they are like deer in the headlights.

      None of that is as bad as the batshit insanity that has taken a hold of the Democrats.

  5. Conservatives consistently want more spending and less personal freedom, and then other people say “Oh, they’re not conservatives.”

    I think they ARE conservatives. Conservatives want more spending and less personal freedom. What separates conservatives and liberals is their attitude on a few hot-button social issues.

    By the way, Milton Friedman used to say it’s the spending that matters, not the deficit. He was right.

    1. These days Liberals want to profoundly CRUSH Freedom of Speech, Conscience, Religion & Association for those they disagree with….Pretty evil stuff!

  6. “Indeed, the gap between what the federal government spends and what it takes in is growing wider. ”

    The federal government spends today what revenues will be in 5 or 6 years; put another way, today’s revenues would have covered the spending level of 5 or 6 years ago or had very small deficit. The trend there is pretty stable over the last 2 or 3 decades, excepting the 2008/9 years.

    E.g.:
    2004 revenues $1.880T 1999 spending $1.701T
    2005 revenues $2.153T 2000 spending $1.789T
    2006 revenues $2.406T 2001 spending $1.862T
    2007 revenues $2.568T 2002 spending $2.010T
    2008 revenues $2.524T 2003 spending $2.159T
    2009 revenues $2.105T 2004 spending $2.292T
    2010 revenues $2.162T 2005 spending $2.472T
    2011 revenues $2.303T 2006 spending $2.655T
    2012 revenues $2.450T 2007 spending $2.728T
    2013 revenues $2.775T 2008 spending $2.982T
    2014 revenues $3.021T 2009 spending $3.517T
    2015 revenues $3.249T 2010 spending $3.457T
    2016 revenues $3.335T 2011 spending $3.603T

    So all it would take to get back in the black (or fairly close to it), so to speak, is to assume that right now we have a big enough government spending enough money–if we don’t have a big enough government now, we never will–and say “freeze it”. Don’t allocate another penny in budget for next over this year, not even for inflation. Hold that course for a mere five years and let revenues catch up.

    No big cuts needed, no new taxes needed. Just the fortitude to say enough is enough.

    1. The old people in the Ruling Class are likely only 10 years from dying.

      They earned the right to pile debt on top of debt for those young people.

      WE ARE BOOMERS!

    2. The problem is two thirds of federal spending is codified into law and it goes up automatically each year. You can’t freeze spending at the current level without changing medicare/SS/medicaid etc. laws.

      1. So change the laws. It’s not like they came down with Moses from Mt Sinai carved in stone…

        1. In other words, reform medicare, medicaid and social security? I’m all for it, but honestly, where is the political incentive for that? Baby boomers are still the largest voting block right?

      2. Agree about the spending. If we “freeze” spending, that means no SS or other retiree COLA’s, only letting the number of new SS, Medicare, and disability recipients equal those that died or otherwise left the program the previous year, no inflationary increases in payments to health care providers or any other government contractor, etc. I don’t see these measures being politically feasible.

  7. Political Lying

    The Democrats are more candid than the Republicans; namely, Big Government, Big Spending, and Big Deficits. The Republicans claim to promote the opposite but lie.

    Excerpt from the novel, Retribution Fever:

    In 1994, two generations after FDR and before being disgraced, then-Congressman “Newt” Leroy Gingrich (b. 1943) had led his gang of Republicans to regaining control of Congress by preaching Small Government with a balanced budget. Including “off-budget items”, the Republicans never balanced the federal budget; and, by 2008, after controlling the White House and the Congress for seven years, the Republicans expanded Big Government and dug the deepest ditch of debt into which the country ever descended; that is, until the next President, Democrat Barack Hussein Obama II, entered the Oval Office.
    Lying is a verbal behavior. Verbal behavior like instrumental behavior, the behavior of an organism upon its environment, is described by the principles of the Science of Human Behavior. A politician lies and is elected. Is he more or less likely to lie in the future?
    “Can political lying be eliminated?” we asked ourselves.
    “No,” we answered.
    “Can political lying be minimized?”
    “Yes,” we answered.
    “How?”

    1. Citing Fiction, huh?

    2. “Political Lying”?

      You repeat yourself.

    3. Obama signed that FY2009 budget, cretin.

    4. The Democrats are more candid than the Republicans

      You got it backwards.

      The Democrats are pretending that government spending is good for the people and doesn’t come at costs.

      Republicans go along with big government spending because they politically have to, but at least they are honest about the fact that it will hurt Americans badly in the long run.

    5. “The whole modern world has divided itself into Conservatives and Progressives. The business of Progressives is to go on making mistakes. The business of Conservatives is to prevent mistakes from being corrected. Even when the revolutionist might himself repent of his revolution, the traditionalist is already defending it as part of his tradition. Thus we have two great types — the advanced person who rushes us into ruin, and the retrospective person who admires the ruins. He admires them especially by moonlight, not to say moonshine. Each new blunder of the progressive or prig becomes instantly a legend of immemorial antiquity for the snob. This is called the balance, or mutual check, in our Constitution.”

      ― G.K. Chesterton, 1930

  8. All that matters is Not Trump’s Fault.

    1. Trump controls Senate votes, got it

    2. He should put forth a more responsible budget, but then, democrats will fight him tooth and nail.

      De Croats are the party of treason and Marxism.

  9. Its definitely the Democrat’s fault. They are the Party of slavery after all.

  10. The economy is good now and we are still running a deficit. We need to be making the point that no one believes in Keynesean economics. Next time the economy dips, tons of people will cite Keynes as a reason to increase spending. Their argument will fall flat if they have already been shown to have rejected Keynesean economics during a strong economy.

    1. The economy is good now and we are still running a deficit.

      No, the economy is not good, any more than you are wealthy because you buy a lot of crap on credit.

      Sorry, sooner or later, the bill is coming due and the paper gains and paper money you thought you had will turn out to be a mirage.

      1. This. We are borrowing ~5% of GDP per year. Remove the Keynesian spending and we’d be in a recession.

  11. “Nothing left to cut.”

    1. ^^^THIS^^^….but, think of the CHILDREN!

  12. The time has past when cutting spending will alone reduce the deficit and debt. We will need cuts and more taxes. Sorry, but we have been digging a hole so long that it will take both to get out. Question is where are politicians willing to support this approach? Most are retired, it appear that helps clear their vision for realistic solutions.

    1. Why is it not possible to reduce spending to the point where revenue=spending? And are you so sure that increased taxes will bring considerably more revenue?

      1. You as a single person might be able to cut enough spending. Perhaps a group of 5 people could also make the cuts necessary. I have my doubts but perhaps 100 people could work out the cuts. What I can say for sure is that 535 people could not agree on the cuts necessary. We know that for a fact.

    2. As Friedman once observed, a politician will spend every nickel he can get his hands on, and as much more as he can get away with.

      Saying tax hikes are needed to solve the debt is like saying an alcoholic needs more booze to fix his problems…

  13. both Democrats and most Republicans

    It’s like reading a transcript from CNN. 40% of Senate Republicans supported the bill, but, you know, both parties…

  14. Why is it we never hear from any Senator that voted against the bill (and the previous one)? Need to start requiring lawmakers to add reasoning for yes and no votes.

    1. You suspect the reasons they’d give would be sincere?

  15. The average politician won’t touch this subject, let alone act upon it in a positive way. For some politicians, they see it as a platform that will lose them votes (most voters are clueless on economics, spending, debt, etc.); other politicians, they can’t bribe voters by promising them free stuff if they act responsibly; and the rest will be worried about not being able to steal for themselves (graft, backdoor favors, bribes, etc.) if spending & debt is controlled.

    $22 trillion. The house of cards is beginning to shake….

  16. […] Corruption: Bipartisan Senate vote dismissed budget balancing bill (Report) […]

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