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It's become normal to argue for pay-go budgeting on the grounds that that like a business or a household, government shouldn't spend what it doesn't have. Brian Beutler dispatches with this thinking nicely:
Americans everywhere expend beyond their immediate means all the time. It's gone too far in the last many years, but there's nothing wrong, in principle, with buying some stock, taking on a bit of credit debt, having a mortgage on a house, or putting money into a certificate of deposit account. We'd actually have some pretty big problems on our hands if Americans suddenly turned to pay-as-you-go personal budgeting, even though they're certainly moving into less risky positions as the economy nosedives.To be sure, you can waive pay-go with 60 votes, which is the same number of votes you need for, well, anything. So it's not exactly the strongest impediment to spending. But still, Brian is right. Debt can be good if you expect that spending will offer a greater return than saving. And right now, because Treasury bonds are the last safe investment, it's the cheapest it's been for the government to borrow money in 50 years.
