January 28th, 2009,
Fairfax, VA—Americans for Limited Government President Bill Wilson today strongly condemned Congress for voting in favor of the $819 billion spending bill, H.R. 1, in the House of Representatives “that is certain to consign future generations to permanent debt to foreign creditors.”
“Congress is only adding to the national debt, now totaling $10.7 trillion,” said Wilson. “And they do so knowing full well that the money to pay for their extravagant spending spree needs to be borrowed from elsewhere.”
The national debt of $10.7 trillion includes $4.3 trillion owed in the form of unfunded obligations to Social Security, Medicare, and other commitments, and $6.4 trillion held privately, $3 trillion of which is held overseas.
Forty percent of the debt held privately comes due this year, and most economists agree that the only way for the government to pay it is to borrow more money.
“The problems with the economy started in large part because of government excesses: too much credit, too much borrowing, too much spending, and too much debt,” Wilson said. “Only a madman would now suggest that borrowed money on this sort of scale—which needs to be paid back—would provide any long-term economic stimulus,” Wilson added.
“Instead, because of this $819 billion boondoggle, paying down the national debt will eat up an ever-larger share of the overall economy in the years to come, diverting capital from creating new jobs and enterprises,” Wilson explained.
“And, instead of fixing the problems government created, the House has now voted to make things worse by adding another $1.2 trillion to the debt when interest and other considerations are calculated,” Wilson noted.
The House voted 244 in favor, and 188 against.
Wilson believes that extraordinary government interventions to date have discouraged savings, investment, and capital creation. According to the Congressional Budget Office, even without the $819 billion spending bill, the federal deficit will rise to $1.2 trillion, or 8.3 percent of GDP, in 2009, an all-time high.
“Markets will not recover any time soon unless the government generates a real plan to pay off the debt and get rid of wasteful spending,” said Wilson.
“Instead, the House voted to increase the deficit, increase all of our children’s and grandchildren’s financial burden, increase future interest rates and taxes, and once again shackle the American taxpayer to a mountain of debt,” Wilson concluded.