Globalization, partisanship drive runaway debt
Senators always worked together and the United States was always fiscally responsible — until 2001. We paid for all our wars, depressions, recessions, stimulations and bailouts. We paid for World War II with the payroll tax, and took 200 years before reaching a national debt of $1 trillion in 1981. Republicans and Democrats were sensitive about deficits and paying for government.
In 1971, the Senate Appropriations Committee realized that it was reporting 13 appropriations bills without regard to total spending and in 1973 instituted the budget process. In 1983, we made Social Security fiscally sound and, in 1985, Republicans and Democrats joined in Graham-Rudman-Hollings to cut spending.
President George H.W. Bush no doubt swore to act in the nation’s best interest at his swearing in, and in 1992 broke his pledge against taxes to join the Democrats in an effort to balance the budget. In 1993, the Democrats in the House and the Senate cut spending $250 billion and raised taxes $250 billion without a single Republican vote.
In 1973, Republicans and Democrats joined in a law limiting spending in elections. The Supreme Court in Buckley vs. Valeo set the law aside and Republicans and Democrats commenced raising money against each other. When I heard of a fundraiser for my opponent with all the Republicans from my Commerce Committee present, save Ted Stevens, my reaction was: “If they want to get rid of me, I want to get rid of them.”
Partisanship set in. Partisanship was formalized in 1993 when Congressman Newt Gingrich led the fight to deny Republican votes for deficit reduction in both the House and Senate.
When President George W. Bush took office in 2001 two things came together: Competition in globalization ended; partisanship was set in concrete. To compete in globalization, industry sought to have trade laws enforced and invested billions to increase productivity. The textile industry invested $2 billion a year to upgrade facilities. Where 25 workers were required in the card room, now none was required; where 125 workers were required in the weave room, now only 15. The U.S. textile industry became the most productive, but presidents vetoed bills calling for enforcement of laws against dumping.
President Clinton went for NAFTA with Mexico, supported China’s entry into the World Trade Organization and in 2000 granted “most favored nation trade status” to China. Industry stopped competing in globalization and gave up trying to get dumping laws enforced. Offshoring hemorrhaged!
Between 2001 and 2010 the United States lost one third of its manufacturing. Since 2001 Detroit has suffered a $1.7 trillion deficit in the balance of trade in motor vehicles. This put GM and Detroit into bankruptcy. Today, South Carolina has the skills to make “the ultimate driving machine” for BMW and Boeing’s Globemaster but we’ve lost our textile industry and suffer 8.1 percent unemployment.
The Clinton Budget Initiative in 1993 gave the U.S. eight years of its strongest economy and President Bush a balanced budget in 2001. But Bush cut taxes, started wars, added prescription drugs to Medicare, stimulated and bailed out, all without paying for them — increasing the national debt $5 trillion in eight years. Democrats, having been denied Republican support in 1993, weren’t about to pay for government. President Obama increased the national debt $5 trillion in four years. We haven’t paid for government in 12 years, adding $10 trillion to the national debt. According to the White House, we will add another $759 billion to the debt by the end of next month, ending the fiscal year.
Now comes Paul Krugman obscuring budget history in his Aug. 16 New York Times column: “So we asked whether the deficit has gone up or down since January 2010. ... A majority of those who replied said the deficit has gone up ...” Krugman continues: “We have an ill-informed or misinformed electorate.”
The electorate might be ill-informed about the fact of deficits but is definitely informed about the feel of deficits — $759 billion is a “runaway deficit.” Everyone in the country is struggling to pay their bills and they are tired of the government borrowing billions. The $759 billion deficit projected for FY13 exceeds the total of deficits of seven Presidents from Truman through Carter.
Krugman is merely making his case for more stimulation. Ten trillion in twelve years and another $759 billion stimulation this fiscal year has had little effect.
We must pay our bills.
Ernest F. “Fritz” Hollings, a Democrat, served as governor of South Carolina from 1959-63 and in the U.S. Senate from 1966-2005.