The House Deserves Praise for Restoring the PAYGO Rule

Jan 4, 2019 | Other Spending

For Immediate Release

Yesterday the House adopted the rules package for the 116th Congress, which included restoring the pay-as-you-go (PAYGO) rule requiring new tax cuts or mandatory spending increases be offset so as not to add to the deficit.

The following is a statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget:

After the last Congress passed massive unpaid-for tax cuts and spending increases, it is refreshing to see some commitment to fiscal responsibility with the reinstatement of the PAYGO rule.

While a combination of spending restraint and new revenue will be needed to improve our fiscal situation, an agreement to ‘stop digging’ or adding to the debt is an important first step in not making it worse.

PAYGO does not prevent lawmakers from enacting new spending programs or tax cuts; it merely requires they pay for those changes rather than debt-financing them. PAYGO is at the heart of what budgeting actually is – making choices and confronting trade-offs rather than shifting the burden onto new generations.

Of course, the PAYGO rule is only as strong as politicians’ willingness to follow it. To maintain credibility, lawmakers must demand adherence to PAYGO principles and not simply waive the provision to ease the passage of legislation.

With trillion-dollar deficits approaching this year, abiding by PAYGO is the very least we can do.

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For more information contact Ben Tomchik, deputy chief of staff, at tomchik@crfb.org.