With the debate over the fiscal 2011 budget now, for the most part, behind it, Congress will have to address other budgetary matters, with the most urgent being the debt ceiling. According to Treasury Secretary Timothy Geithner, the U.S. will hit its debt limit — the maximum amount that it is legally allowed to borrow — no later than May 16, unless Congress acts.
Plenty of Republicans have been saying that they won’t vote to raise the debt ceiling — and thus risk the economic cataclysm that would result if the U.S. defaulted on its debt — unless they receive various other budget-related measures, including a balanced budget amendment, statutory spending caps, or, in the case of Sen. Marco Rubio (R-FL), just about every budget idea that has ever been mentioned by a Republican. Friday night, Senate Minority Leader Mitch McConnell (R-KY) said that no Republican would vote to increase the debt limit “unless we do something about the debt. And you can write that down!”
But in May of 2003, the GOP was not only willing to raise the debt ceiling in the absence of debt reduction measures, but it did so on the same evening that it blew a brand new hole in the federal budget by approving a giant tax cut for the wealthy:
Without comment or ceremony, President Bush on Tuesday signed a bill allowing a record $984 billion increase in the amount the federal government can borrow, to a record $7.4 trillion. The increased federal borrowing will enable the government to pay for the $350 billion economic stimulus package that the GOP-led Congress passed last week at Mr. Bush’s behest.
That “stimulus package” was the 2003 Bush tax cut. Here is the Congressional Record, showing that, right after approving the tax cut, the Senate made a “turn to the debt limit bill.”
As the Center on Budget and Policy Priorities pointed out, the Bush tax cuts will add $3.4 trillion in deficits by 2019, as well as an additional $1.7 trillion in interest on the federal debt. And contrary to the pronouncements of many conservatives at the time, the Bush tax cuts did not lead to a booming economy and job growth, but rather “the weakest jobs and income growth in the post-war period.”