A key reason why it is an untenable position for Republicans to refuse to raise the debt ceiling is that there is no proposal on the table that creates an immediate balanced budget, let alone one that has actually passed the House. Taking into account the “fiscal cliff” deal, the federal government is expected to collect about $2.6 trillion in fiscal year 2013. Rep. Paul Ryan’s budget called for $3.53 trillion in new spending, the Republican Study Committee’s “Cut, Cap and Balance” plan had $3.46 trillion in outlays, and even Sen. Rand Paul’s budget would spend $3.1 trillion. Conservatives can talk all they want about Republicans refusing to raise the debt limit to force Obama into a balanced budget, but it isn’t a credible position when virtually every Republican in Congress last year voted in favor of adding to our debt.
This, however, could be the basis of a new principle in budgeting – that Congress agrees to raise the debt limit by the amount its budget adds to the debt in the upcoming fiscal year. A rough outline of the process could work as follows. The president releases a budget proposal and both chambers of Congress pass their own budgets. Then, both chambers haggle over the details until they agree on a spending number. Once they do, then Congress raises the debt limit by the amount that the Congressional Budget Office projects that spending will add to the debt during the upcoming fiscal year.