Another Fake Debate: Raising the Debt Ceiling
Time Magazine used the word “zoom” with respect to the “public debt” in a 1941 article and said, “The President questioned the meaning of a legal debt limit, hinted that there should be no legal limit.” There were only newspapers, magazines, movie theatre newsreels and radio to report that the 1940 Democratic platform “made no mention of that fiscal dodo, that old museum piece: a balanced budget. Franklin Roosevelt held to precedent—he didn't mention it, either.”
Bear in mind that the idea of a federal budget was relatively new. Up until 1921, the president did not have much of anything to do with hashing out budget, other approving or disapproving it as the head of his political party. The Budget and Accounting Act of 1921 created the U.S. General Accounting Office (GAO) as part of the Legislative Branch. Its job was to audit federal books and prevent fraud. In the Executive Branch, the 1921 legislation created the Bureau of Budget to coordinate budget submissions by various departments and agencies.
Former Treasury Department economist Bruce Bartlett wrote in Forbes, “Deficits primarily resulted from wars, and strenuous efforts were always made to pay them off as soon as possible afterward. On those occasions when the Treasury needed to sell bonds, each individual bond issue had to be specifically authorized by Congress.”
The federal budget is actually on automatic pilot, anyway. The reality is that neither Congress nor the presidents have anything so say about it. “If you take all the earmarks, unnecessary weapons systems, waste, fraud and abuse and everything else you can think of that deserves to be cut, it still adds up to drops in the ocean compared to Social Security and Medicare,” Bartlett says. “As long as those programs are off limits the president's budget will continue to decline as a matter of political and economic importance.”
As to the meaning of the debt ceiling that President Roosevelt questioned, since March 1962 the debt ceiling has been raised 74 times. According to the Congressional Research Service, 10 of those times have occurred since 2001. Theoretically, the debt ceiling limit is supposed to help Congress control spending. However, in reality, the debt limit is ineffective in controlling spending and deficits. Politicians and reality continue to be strangers to one another.Continued on the next page