As debt ceiling negotiations enter the final stages, lawmakers must focus on the overarching goals of stabilizing and then reducing our debt and enacting strong enforcement mechanisms to ensure debt targets are hit.
Proposals from Speaker of the House John Boehner and Senate Majority Leader Harry Reid have rightly called for down payments on future debt reduction in tandem with a debt ceiling increase and a special process to achieve additional savings over the next several months. (See here for more on the similarities and differences.) However, there is much room for improvement.
Though some details remain unclear, the savings from these proposals would almost surely not be sufficient to put the debt on a declining path relative to the economy. Lawmakers should strengthen both the debt reduction goals and the enforcement of those goals in order to create a credible process that has the best chance of controlling the growth of future debt.
Click here to read this paper on CRFB.org.
Click here to read the PDF of this paper, or download it to the right.