Thursday, November 15 , 2018, 10:05 pm | Fair 52º

 
 
 

Harris Sherline: The Sky’s the Limit

Today's political leaders are no better than past generations at showing restraint in spending other people’s money

When is a limit not a limit? When Congress says so, that’s when.

Harris Sherline
Harris Sherline

Congress recently increased the U.S. debt ceiling by $1.9 trillion to more than $14 trillion, and President Barack Obama signed the bill Friday.

So what? Who cares?

The reason for formally approving increases in the national debt is to make it legal for the U.S. government to borrow more money — that is, to increase the federal debt to permit increased borrowing.

The James River Maven notes: “Under the Constitution, only Congress has the authority to borrow money on behalf of the United States. But, a long time ago, Congress delegated this authority to the secretary of the Treasury. To make sure that the secretary does not go too far, Congress has set a maximum amount of borrowing that the secretary may engage in. That is what we refer to as the debt ceiling. It is not really a debt ceiling but a ceiling on what the secretary can borrow.”

The United States has had public debt since the nation was founded. The first national debt was recorded at about $75.4 million in 1791. Seems like chump change today.

The debt continued to grow after the Revolutionary War, although for a period in 1835 it contracted to zero but quickly grew after that. After the Civil War, the debt expanded from just $65 million in 1860 to more than $1 billion in 1863 and to $2.7 billion after the war.

From there, the debt fluctuated until the 1900s. In the 1920s, it grew to about $22 billion as a result of World War I, increasing thereafter to $260 billion in 1950 at the end of World War II. From there it grew at about the rate of inflation until 1980, when it hit about $909 billion. In subsequent years, from 1980 to 1992, during the presidencies of Ronald Reagan and George H.W. Bush, the debt quadrupled. President George W. Bush took it to $10.7 trillion in 2008 from $5.6 trillion in 2001.

Raising the U.S. debt limit annually has become an absurd dance in the Kabuki theater of Congress. Total debt has increased more than $500 billion every year since 2003, and the 2010 federal budget is off the charts.

So, why bother to formally approve an increase in the debt ceiling, when the government can have the Federal Reserve Bank issue all the bonds it wants or just turn on the printing presses?

The process has become so routine that almost no one notices. The media dutifully report the event, but very few people among the general population pay any attention, other than perhaps a few political junkies. However, it’s of interest to note that the vote in the Senate to increase the national debt by $1.9 trillion was not unanimous. In fact, it was passed by a 60-40 margin.

Who were the 40 who voted no? Perhaps not surprisingly, all of the Republican members of the Senate voted no, while all of the Democrats voted yea, thereby turning any attempt at fiscal restraint into an exercise in partisan politics — which is nothing new for our legislators these days, of course.

Presumably, the purpose of vesting the authority for increasing the national debt in Congress was to impose some degree of financial discipline on the government. Unfortunately, it appears that the founders didn’t anticipate the degree to which future legislators would be spendthrifts. Although their writings recognize the potential fiscal weaknesses of people in general, it appears they didn’t anticipate the sheer failure of all moral and ethical limits on fiscal behavior to the degree that exists today in our body politic.

We have become a profligate society, so perhaps it’s not surprising that our politicians can’t manage money or keep their hands out of the cookie jar. It’s obvious from the historical record that, with very few exceptions, past generations of American political leaders have fared no better than the current crop at restraining themselves from spending other people’s money.

The Patriot Post Digest (Feb. 5) noted: “The (2010) budget is further proof that Obama and the Democrats think that they can spend your money and plan your life better than you can. That’s the antithesis of liberty.”

— Harris R. Sherline is a retired CPA and former chairman and CEO of Santa Ynez Valley Hospital who has lived in Santa Barbara County for more than 30 years. He stays active writing opinion columns and his blog, Opinionfest.com.

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