January 7, 2003
Congressman Adam Smith (D-Tacoma) released the following statement today on the economy in light of both the Republican economic “stimulus” package introduced by the president and the rules for the federal budget introduced by the Republican House Leadership for the coming session.
“As the Republicans take over the majority in both chambers for the 108th congress, they are endorsing dynamic scoring and automatic debt increases, both tactics that count on overoptimistic numbers and rosier projections to hide the true cost of economic budget choices. Such irresponsible and deliberate optimism can only spell budgetary doom for years to come.
“Many economists have long argued against dynamic scoring because of a lack of reliable economic models on which to base projections. And all that automatic debt increases would do is to hide the true cost of all government spending and tax cuts and release the government from all accountability towards balancing their checkbook. So what the Republicans are saying today is that we should look at the economy through rose-colored glasses and press snooze on the only alarm that goes off when the spending gets too high. It’s just ridiculous that in an era when our nation faces the challenge of balancing dwindling resources with the need to increase federal spending in critical areas, they’re arguing that we should be less careful about watching how we spend our money. Instead we should be looking at conservative numbers and tightening our belts all the way around.
“Congress and the White House are acting as though fiscal responsibility no longer matters and that just isn’t true. Without a doubt, our defense and foreign affairs budgets need additional money because we have new challenges. However, the federal government cannot continue using the war on terrorism as an excuse to abandon fiscal restraint. Fiscal responsibility must be a cornerstone of our economic policy, and I will continue fighting to get our budget balanced.
“Yes, we must meet our most pressing priorities of protecting our country against terrorism, improving our international relations, and growing our economy. I have said again and again that I agree with the president that these current challenges warrant small, short-term deficit spending. However I am extremely concerned about the lack of attention to sound budgeting practices that would both address our most pressing current needs, and establish a framework for a long-term, sustainable revenue and spending plan without relying on massive borrowing.
“We need an honest discussion of the budget, with cold hard facts and numbers, instead of relying on ‘smoke and mirror’ budget gimmicks and heroic assumptions to wish away the hard choices we face. Unfortunately, the federal budget debate to this point has had too few voices standing up for these principles and as a result elected officials are still promising more than the federal government can possibly deliver.
“While government by itself cannot create a good economy, it can clearly set the stage for growth in the long-term by maintaining fiscal discipline. Fiscal responsibility still matters. During the 90s, careful, disciplined financial stewardship yielded balanced budgets, helping to fuel economic growth. Our economy cannot sustain a return to yearly budgets that drive us deeper and deeper into debt.
“War and recession have brought back deficits, but they are not an excuse to undo long-range budget discipline. To get back on track, Congress and the president must have the courage to make the hard, honest choices that are necessary right now to ensure that those deficits will be small and short-term. With retirement of the baby boom generation approaching, failure to discipline our budget in the coming years will have far reaching ramifications and add crushing new burdens on workers and taxpayers in the following decades. We must take action now with an honest discussion of the choices we face and develop a budget that is fiscally responsible. Dynamic scoring and automatic increases in the debt level just aren’t going to do it.”
Since heading to Congress in 1997, Rep. Adam Smith has consistently been a strong advocate of fiscal discipline and honesty in all federal budgeting. He believes that a return to sincere and deliberate fiscal discipline must be the cornerstone of our government’s economic policy. In the 1990s when Wall Street and Main Street saw that the government was serious about keeping its books in order and reducing the national debt, interest rates fell and private investment grew. Businesses created jobs and all Americans benefited from lower interest rates on their mortgages, student loans and consumer credit.