WASHINGTON – House Budget Committee Chairman John Spratt issued the following statement today on passage of fiscal responsibility rules for the U.S. House of Representatives.

“The House has started the 110th Congress with a fresh commitment to fiscal responsibility. By reinstating the pay-as-you-go principle, and making it part of the House rules, and by denying fast-track reconciliation procedures to measures that increase the deficit, the House has begun putting the budget back on track, and we hope, back toward balance in the foreseeable future.

“Republicans say that these new rules do not reduce the deficit, and they may not; but they do establish in the House rules a common-sense, truly conservative principle: when the budget is in deficit, at the very least we should avoid making it worse; and in particular, we should be wary of entitlement increases that are not paid for and tax cuts that are not offset.

“The pay-as-you-go rules provide that any increase in entitlement benefits has to be paid for by a new revenue source or by an equivalent cut in other benefits, and any cut in taxes has to be offset by an equal cut in entitlement spending or by changes elsewhere in the tax code. In other words, no such legislation can worsen the deficit.

“The pay-as-you-go concept was originated in the late 1980s by Democrats looking for ways to rein in the deficit. But it was embraced by the first President Bush in the Budget Enforcement Act of 1991; adopted by President Clinton in his deficit-reduction budget of 1993; extended by President Clinton and Congress in the bipartisan Balanced Budget Act of 1997; and endorsed by the second President Bush in 2001.

“The rules passed today are not immutable, but they raise a strong presumption favoring fiscal responsibility, and hold accountable every member who votes to waive or relax them. Furthermore, they were budget law from 1990 to 2002, and supplied some of the discipline that helped wipe out the deficit. This is why the rules were extended three times: they worked. In 2002, the Administration and Congress, under Republican leadership, allowed the pay-as-you-go rules to expire. Partly as a result, a budget with a surplus of $236 billion in 2000 was in deficit by $413 billion in 2004.

“With today’s deficit hovering in the range of $250 billion, we have a long way to go before the budget is balanced, but these new rules should help again, as they did in the 1990s.”

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