Well, here we go again. We have another government shutdown because playing politics is more important to Congress than sustaining an uninterrupted functioning of our government. But, by changing our fiscal processes to conform with what most other countries have adopted, we can prevent this from happening in the future.
Most nations grant the authority to borrow funds needed to pay for approved spending as part of the budget approval process. The rationale for doing so is simple; once a government authorizes expenditures, it simultaneously authorizes payment of those expenditures.
But in the United States, we separate the processes. The Constitution gives the power of the purse to Congress. Each year Congress establishes a budget by setting planned amounts of revenue and expenditures.
Over the past half-century, Congress has consistently approved budgets where expenditures exceed revenue, thereby causing budget deficits that must be funded through additional borrowing.
However, under congressional parliamentary rules, authorizing the corresponding incremental borrowing is not part of the budgetary process. Therefore, when the existing debt limit is reached, Congress must separately approve additional borrowing by increasing the congressionally authorized limit on the amount the government can borrow.
Prior to 1917, Congress authorized each federal debt issuance separately.
However, the financial pressures resulting from the U.S. entry into World War I required a more streamlined approach. To provide greater flexibility in funding war efforts, in 1917 Congress passed a bill authorizing the creation of a ceiling on the national debt and allowing for debt issuances up to the ceiling amount.
Once the debt ceiling is reached, the federal government can only fund payment of its expenditures to the extent it collects revenue. When that happens, the federal government is forced to shut down much of its activity because it lacks the funds to conduct those activities until the debt ceiling is increased. If it fails to make an interest payment on time, it will default on federal Treasury obligations, which would undoubtedly result in economic chaos.
The separation of appropriating expenditures from funding those expenditures resulted in occasional political interference in keeping the government running. In 1979, the House of Representatives adopted the Gephart Rule, a parliamentary rule that automatically raised the debt ceiling concurrently with the passage of a budget bill.
Since the Constitution mandates that budget bills originate in the House and the Senate procedurally must follow suit, raising the debt ceiling was not an issue while the Gephart rule was in effect. The Gephart Rule was repealed in 1995, and unsurprisingly, government shutdowns followed in 1995 and 1996.
Most bills require 60 votes to pass the Senate. Because Senators increasingly vote along party lines and neither party holds 60 votes in the Senate, it can be difficult to pass critical legislation. There are two principal exceptions to the 60-vote requirement — bills passed through the budget reconciliation process and approval of presidential appointments.
While it is possible to separately raise the debt ceiling through the budget reconciliation process, procedural complexities interfere with that process. Congress can pass the budget with a simple majority using the reconciliation process. But it is usually unable to pass a debt ceiling increase unless 60 senators vote in favor of the increase, or as the Democrats did last spring, the minority party decides not to filibuster.
Historically, this provided the minority party considerable political power to extract concessions from the majority party.
During the Biden Administration, the Republican minority was able to extract politically consequential concessions in order to avert a government shutdown. Today, the roles are reversed and it is the Democratic Party that seeks concessions from the Trump Administration, which, as of the date this column was written, is not inclined to make any concessions.
Government shutdowns are costly, result in significant uncertainly and exacerbate political divisions among the American people. This political drama and its adverse consequences could be avoided if either the House readopted the Gephart Rule or the Senate modified its reconciliation process to facilitate approving debt limit increases. Either action merely requires a simple majority vote.
Our national debt is growing at an unsustainable pace. The mentality of delaying the consideration of the debt consequences until there is a requisite debt ceiling increase is congressional absurdity.
If debt limit increases were incorporated into the budgetary process, perhaps Congress would be more financially responsible because it would be forced to consider debt implications concurrently with the appropriation process. Doing so would prevent government shutdowns and could even change the focus of the budgetary discussions.
Jim de Bree is a Valencia resident.
