Putting a limit on Uncle Sam’s credit card

House Democrats made good on one of their promises, restoring a budget procedure that the Republicans allowed to lapse in 2002 designed to restrain deficit spending.

The procedure, known as “pay-go,” shorthand for “pay as you go,” basically requires that any new spending or tax cuts be offset by spending cuts or tax increases elsewhere in the budget. It played a small but critical role in the string of four balanced budgets that ended in 2001.

The Republicans, who over the past five years presided over the largest federal spending increases since the Great Society, are still not enthusiastic about it. The Democrats voted unanimously to revive the measure; only 48 Republicans did.

The rap against pay-go is that it makes tax cuts much more difficult while only marginally affecting spending because it does nothing to contain the automatic increases in massive existing entitlement programs like Social Security, Medicare and Medicaid.

True to a degree, but it will act to restrain new deficit spending and tax increases achieved by borrowing against future revenues by making lawmakers answer a simple question: How are we going to pay for this?

It is a question worth asking as the national debt nears $9 trillion and paying the interest on it is the fastest-growing item in the federal budget.

No question pay-go will make the lawmakers’ lives more difficult, but at least on a bipartisan basis. It greatly complicates President Bush’s efforts to extend his tax cuts and Democratic plans to increase spending on health care, homeland security and education.

And pay-go will be a serious obstacle to eliminating the increasingly unpopular Alternative Minimum Tax, the abolition of which will require the tax committees to make up for $1 trillion in revenue lost over 10 years.

However, pay-go is not a straitjacket. It can be easily waived, although the Senate is considering requiring a 60-vote supermajority to do so. But having pay-go in place will force Congress to focus on the fact that our revenues and borrowing power are not infinite.