Washington has made some progress towards budget rationality as of late, though much more work lies ahead to put the country on a fiscally sustainable course. In the meantime, we cannot afford to backslide. Following the basic budgetary principle of paying for new initiatives is essential to ensuring we don’t squander the gains we have made.
The government funding deal Congress is now considering provides a detailed federal budget for the first time in years and continues the deficit reduction achieved to date. As lawmakers move on to other priorities, following pay-as-you-go (PAYGO) principles will be imperative to building on the momentum achieved and making sure we don’t take any steps backwards.
The debate over extending expanded unemployment insurance benefits is a prime example. Some lawmakers wish to extend the benefits without offsetting the cost elsewhere in the budget. While a very strong argument can be made for an extension and other investments to spur the economy as many Americans continue to struggle to find sufficient employment, that does not mean it should add to the debt. As our partners at the Committee for a Responsible Federal Budget (CRFB) have said, “If something is worth doing, it is worth paying for.”
CRFB has laid out the case for abiding by PAYGO. Among the reasons is that following PAYGO will enhance the impact of economic growth policies by ensuring they do not add to the national debt. CRFB also highlights several ways in which an unemployment insurance extension can be paid for. Our Maya MacGuineas also offers ways to pay for an unemployment insurance extension and other priorities in an op-ed.
A bipartisan group of senators have been attempting to find agreement on offsets for an extension of jobless benefits. Those efforts should be encouraged so that an example can be set moving forward.
National Debt and You