WASHINGTON ? Congress passed legislation Thursday that mandates that Congress can”t spend more than it can afford.
The Statutory Pay-As-You-Go-Act requires Congress to offset all new policies that reduce revenues or expand entitlement spending.
Congressman Mike Thompson, who represents Lake County and surrounding counties, said he supports the bill.
“The federal government”s budget shouldn”t be any different than a family”s budget ? you don”t spend more money than you can afford,” Thompson said. “And if you do make a big purchase, you have to cut back elsewhere.”
“This is a good first step toward restoring fiscal discipline to Washington. I”ve been working to pass Pay-As-You-Go legislation, also known as PAYGO, since I was elected to Congress and I carried the measure of the floor of the House during the 108th Congress,” Thompson said.
The bill passed is similar to the bipartisan PAYGO law in place in the 1990s, which helped reverse huge deficits, create budget surpluses, and produce an economic boom. In 2002 the budget rules were allowed to expire, contributing to the dramatic turnaround from a projected 10-year surplus of $5.6 trillion in 2000 to projected deficits of more than $11 trillion in 2009.
The bill makes PAYGO law, so that future administrations can”t choose whether or not they want to follow pay-as-you-go principles.
There are some protections in the rule, so that during an economic crisis Congress and the president can do what is needed to strengthen the economy.
The bill headed to President Barack Obama”s desk for signature.
