Issue in Focus
Mar 06 2020
There is an old saying that insanity is doing the same thing over and over again, but expecting the same results. And unfortunately, by this standard, Congress has for many years proven to be stark raving mad. The energy bill Congress began to consider this week – which authorizes billions of dollars for dozens of unnecessary energy programs – is just another example.
It is yet another bill that involves the federal government in things it should not be involved in, it spends massive amounts of money that we do not have, and it kicks the can for paying for debt we can’t afford yet further down the road…. on top of the $22 trillion we have already incurred. Some of my colleagues claim that this bill is “paid for,” because the Congressional Budget Office (CBO) has estimated that it will add nothing to our national debt. However, that is only the case through an unsound, unreliable accounting gimmick.
This bill will “pay for” the numerous programs it contains by borrowing money now, and postponing the sale of petroleum in the Strategic Petroleum Reserve (SPR) to pay for it later. The SPR, which is owned and maintained by the Department of Energy, consists of 700 million barrels of petroleum. Starting in 2015, Congress has mandated that we sell 5 million barrels from the SPR to create revenue to pay for other programs in those authorizations.
Since then, not a single barrel mandated to be sold from those authorizations has been sold. And now, this bill mandates the SPR to postpone the sale of those barrels until even later, under the reasoning that they will be worth more later on, and so will bring in even more money then. But this is neither sound nor reasonable fiscal policy.
Consider this analogy. Let’s say I want to buy a fancy new car – even though I am already in debt, and have no cash in my bank account. So the bank gives me a loan on the condition that I sell my house in the next few years, when it will be worth more and can cover the cost of the car. But a few years roll around, and at that point I need to buy a different car that can fit my growing my family. And then I ask for another loan, on the condition that I sell my house in yet another few years when it will be worth more and can cover the cost of both cars. And instead of ever actually selling my house, I continue to take out loans on the assumption that I will sell it at some point in the future when it will be worth enough to pay off all of my loans.
No bank, no banker in his right mind, would ever agree to these conditions. It’s fiscally unsound – fiscally insane, even. And if there’s one thing we know about Congress, it’s that putting it off until later almost always means that it never happens.
On top of that, many of the programs that this package authorizes are unnecessary and unsound themselves, and are not projects that the federal government should be involved in.
As it currently stands, there is nothing about this package that is sane. If we continually kick the can down the road, there will only be disaster waiting for us, and for our children.
Let’s hope Congress finally learns its lesson, and soon.