Friday, February 05, 2010


In the list of odd terms thrown around the halls of Congress, the word PAYGO has been used so much that many forget what it stands for. Yesterday, the House voted to put in statute the “Pay-As-You-Go” rule.

As a bipartisan fiscal responsibility group put it: ‘PAYGO requires anyone proposing tax cuts or entitlement expansions to answer the question: ‘How would you pay for it?’ Going through this process would force an explicit trade-off between spending, taxes and debt, which is exactly the priority-setting exercise that the budget process should facilitate.’

A New York Times analysis found that 90% of our deficit is due to the policies of the previous administration, the extension of those policies, and the economic downturn. But, this is our mess now, and as was proven in the Clinton administration, PAYGO is a proven deficit-cutting tool.

Under President Clinton, PAYGO helped turn record deficits into a $5.6 trillion projected surplus over ten years. PAYGO was allowed to expire under the previous administration when my friends in the other party controlled the Congress. This led to a series of bills like the Prescription drug benefit or tax cuts for the wealthy that were passed without a single dime to pay for them. My colleagues and I in the House have been obeying PAYGO since 2006.

It is not the perfect solution, but it is a substantial step in the right direction. PAYGO can’t get us out of our fiscal hole, but it can keep us from digging it any further.

It was once again sobering that we had to raise the debt ceiling yesterday and many rushed to the floor to complain about how high our debt was. It is simply not enough to complain. We have to actually do something to control spending.

For more about PAYGO my friend Majority Leader Steny Hoyer (MD-5) has put together an informative video on the policy >>>