In the aftermath of the 2011 Budget Control Act (BCA), Republican Congressional leaders announced that it had established a principle that policymakers must match any increase in the debt limit with equal or greater cuts in spending. By voting this week for a short-term increase in the debt limit that's not tied to spending cuts, House Republicans have retreated at least temporarily from that position.
As we explain, future legislation must continue to avoid any dollar-for-dollar linkage between a debt-ceiling increase and spending cuts -- a stance that's commonly called the "Boehner rule." Following the Boehner rule would impose an unnecessarily onerous, and ultimately devastating, budget goal.
This rigid formula would require additional spending cuts in any year in which the debt grows in dollar terms, even if the debt is stable or shrinking in relation to the economy. Programs that strengthen economic growth or serve low- and middle-income Americans could be cut to allow the debt ceiling to rise, but savings from curbing special-interest tax breaks would not count for this purpose.
The Boehner rule is so restrictive that even the very ambitious budget plan from Fiscal Commission co-chairs Erskine Bowles and Alan Simpson -- which would shrink the deficit to less than 1 percent of gross domestic product (GDP) before the end of the decade and the debt held by the public to 62 percent of GDP in 2022 -- falls far short of meeting it. The Boehner rule would require about $4 trillion more in program cuts over the next ten years than Bowles-Simpson.
Ultimately, the Boehner rule would compel policymakers to adopt program cuts of unprecedented severity, like those in the House-passed budget resolution authored by Budget Committee Chairman Paul Ryan. The Ryan budget would cut non-defense discretionary programs by $1.2 trillion below the BCA's already stringent limits, replace guaranteed Medicare benefits with "premium support" vouchers, raise the age of Medicare eligibility, add 30 million people to the ranks of the uninsured by repealing health reform, turn Medicaid into a block grant and drastically cut its funding, and significantly cut other programs serving low-income Americans.
Followed to its logical conclusion, the Boehner rule would radically transform government, dismantling many of the social advances of the past half century or more and paving the way for large increases in poverty and inequality.