In a recent letter to the editor, Stewart C. Harvey of Salt Lake City takes me to task for saying that the government, like private individuals, should be able to balance its books. He then points out, quite correctly, that even families have to use credit to finance large purchases, such as mortgages.
But Mr. Harvey misses an important point in his analysis. Borrowing really isn't the issue here. Paying back is. Most people borrow for a specific long-term asset or expense, then repay the debt. Additionally, they have a limit on their ability to borrow.The federal government, on the other hand, borrows to pay for earlier borrowing. This situation is analogous to an individual taking out a loan to buy a house, then borrowing money to make the payments. In the real world, that person would be thrown into bankruptcy.
Likewise, our country, if it doesn't get control of its run-amok budgeting process, is also headed for financial disaster - in the form of exploding interest costs, increased taxes, inflation; and diminished capital formation, job creation and wage growth.
Furthermore, Mr. Harvey's contention that a balanced-budget amendment would preclude emergency relief monies in times of catastrophe is just plain wrong. The members of Congress will still be responsible to their constituents; and the act provides a mechanism to lift the debt limit in just such cases.
Orrin G. Hatch
U.S. senator