The economy’s growth is at its lowest since the Great Depression. Unemployment rates have dramatically risen across the country. The stock market is unstable–one day it’s up, the next it’s down. And the federal deficit has reached record highs.

This is how the recession in the early 1990s was described.

Congress reacted to that recession by focusing on reducing the federal budget deficit. We did this in part by embracing a principle known as “pay-as-you-go,” or “PAYGO,” which required the cost of any new federal program or initiative be fully offset. For every dollar spent, we had to find a dollar to pay for it.

I was a strong supporter of the original 1990 legislation that created the PAYGO rule. The rationale behind it was simple–if we didn’t add to the deficit, once the economy began to consistently grow again, federal revenue would increase. This revenue, in turn, could be used to reduce the deficit and spur further growth.

The economy began to grow again in 1992 and 1993, and federal revenue did indeed rise. With PAYGO in force, much of the increased revenue was directed at the deficit. As you can see in the graph, this resulted in the gradual decline of the deficit from the 1992 record-high. In 1998, the federal government saw a budget surplus for the first time in 30 years, and the surpluses continued in each of the three years that followed.

Things changed dramatically in 2002 when PAYGO expired. There has been a federal deficit each year since, and our country has increasingly become indebted to China and other countries who have been financing our spending.

I am happy to report that on July 22, the House passed the Statutory Pay-As-You-Go Act, which would re-establish the PAYGO principle–if we are to spend a dollar, we must find a U.S. dollar to pay for it. I was an original cosponsor of this bill because it proved so successful in the 1990s.

There are signs our economy is beginning to recover from the current recession, but we aren’t out of the woods yet. When this recession ends and our economy returns to steady growth, PAYGO will reward our disciplined spending tendencies.

It is my hope that my colleagues in the Senate will recognize the importance of the PAYGO rule and pass the bill as we did in the House. Federal spending must be restrained. PAYGO has a proven track record of helping to get our country’s finances in order.

Congressman Bart Gordon of Murfreesboro represents Tennessee’s 6th district in the U.S. House of Representatives where he is a member of the fiscally conservative Blue Dog Coalition.