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State and Local Government / Transparency

PAYGO Would Only Provide Appearance of Fiscal Responsibility

By Caitlin Hartsell on Sep 17, 2009

Sen. Claire McCaskill is cosponsoring a bill, “PAYGO,” that would limit congressional spending to the amount of yearly revenue brought in. Any new program or tax cut would need to be matched by a revenue source or spending cut at some point that year.

The Columbia Tribune paints this legislation as a much-needed check on out-of-control spending and tax cuts. In theory, it sounds like a great idea, but it is actually a red herring. The Wall Street Journal published an article back in June calling the PAYGO supporters’ bluff. Passing PAYGO would give Congress the appearance of fiscal responsibility without backing it up; the rules would apply neither to discretionary spending nor to existing programs, like bloated Medicare.

PAYGO does ensure, however, that future tax cuts will be nearly impossible to pass. When the Bush tax cuts sunset in 2010, PAYGO would virtually guarantee that government, already overly large as it is, will not get any smaller. Government spending needs to be limited, but in order for such measures to be efficacious there also needs to be spending cuts across the board. Balancing the budget is a noble goal, but the PAYGO proposal won’t satisfy Missourians who want actual fiscal discretion.

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Caitlin Hartsell

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