PRES. DEMOLISHES BORROWING CAPS
Hallowell aims to borrow billions to finance mooted social programs; analysts warn of "inescapable" debt trap
President Alasdair Hallowell prepares to present new colors to the Republican Guard on Tuesday, May 28, 2019
ELLSBURGH (FBCA)- President Alasdair Hallowell today took executive action to eliminate limits imposed by previous administrations on how much the Treasury Department can borrow, sparking fierce headwinds from Federalists and supporters of fiscal responsibility.
Fulfilling a 2016 campaign promise to "unlock our nation's full spending potential", President Hallowell issued Executive Order 18331, which reverses a previous action taken by the Ellsworth administration in 1981. The executive order declares that "the Secretary of the Treasury shall be empowered to borrow, with the full credit of the Federal Union, whatever sums as he deems appropriate for the functioning of the federal government in that fiscal year." The order does not make reference to Congress' constitutional appropriation powers.
The federal government currently pays $5.7 billion towards interest on the national debt in fiscal year 2019-20. The deficit currently stands at almost $11.6 billion.
Analysts at the Economic and Demographics Analysis Office told the FBCA that, under projected borrowing levels, the deficit could balloon to over $100 billion by 2035, while taxpayers could be saddled with billions more in interest costs- making a mockery of President Hallowell's other 2016 promise to cut income tax rates.
Since taking office in 2017, the Hallowell administration has pushed plans to expand federal welfare programs, with a particular focus on drug pricing. Secretary of Public Assistance Bill Seiders told the FBCA that the majority of borrowed funds unlocked by the executive order could be spent by the Drug Pricing Stabilization Corporation (DPSC), which is currently responsible for providing assistance to poor Almoreans who cannot afford pharmaceutical medicine.
In a March speech to the activist Peoples' Council for Drug Prices, President Hallowell proclaimed the dawning of a new era of "free drugs". "The government will become the nation's medicine cabinet- and we will provide affordable care for all those who need it," the President said.
Federalists in Congress, and constitutional professors, were quick to attack the executive order as fiscally irresponsible and, perhaps, illegal. Rep. Torquil Chatto (F-Warenne Island), who as presiding officer of the Chamber of Representatives has immense influence over budget bills, told reporters that the President's action was "reckless and ill-advised[...] it will poison the inheritance we leave to our children."
Sen. Olivia Gulliver (F-Queensland), a constitutional jurist by training, told the FBCA that the executive order infringes upon Congress' power to appropriate federal money. "The Treasury Secretary isn't a congressional officer. He can't appropriate by himself and then make unilateral decisions as to where that will go, no matter what the President says. If this goes to court, which it will, it'll be thrown out real fast."
If the fallout from the executive order lands in the Supreme Court, it will make an acid political backdrop to the summer of 2019, a time when President Hallowell and Congress were expecting to work together to iron out the implementation of April's infrastructure reforms.
Copyright MMXIX. First Broadcasting Corporation of Almorea. All rights reserved.