Business and banking leaders are reluctant to hire, lend and invest for two reasons. First, they fear a lack of demand--there aren't enough people buying enough cars, homes, software or antibiotics to justify expansion of business. Second, they fear that any profits they gain from increased investment will be quickly wiped out by increases in interest rates caused by our government's inability to reduce what we borrow. The debate in
Washington about the debt ceiling is really about removing this second fear.
In the next two weeks, we must raise our debt ceiling in a manner that puts our fiscal house in order. A reckless failure to raise the ceiling means no social security checks, no pay for the troops, and the destruction of our credit rating around the world.
Moving toward a balanced federal budget and lower interest rates will not guarantee growth in jobs--but failure to raise the debt ceiling and cut our deficit will guarantee a huge increase in unemployment and economic disaster for the United States. We should cut the deficit by at least the 4 trillion sought by President Obama. We need sensible and equitable savings from all areas of the budget--entitlements, social programs and defense. A more expeditious end to our presence in Iraq and Afghanistan is a good place to start. The wealthiest Americans should pay for a reasonable share of deficit reduction. The plan must fairly allocate the burden on all Americans so that all Americans can benefit.
Understand this: at present, we cannot pay our bills without huge loans from our rivals--in this case China. That reality is a threat to our security and prosperity. Now is the time for our country to put aside politics, put our country on track to stop borrowing so much money, and put ourselves in position to create the jobs our people so desperately need.
Representative Rob Andrews is the ranking member of the House Subcommittee on Health, Employment, Labor and Pensions.