The first "pay-as-you-go" rule was enacted in 1990 (cbpp.org). "The pay-as-you-go rule, also known as PAYGO, is designed to encourage Congress to offset the cost of any legislation that increases spending on entitlement programs or reduces revenues so it doesn't expand the deficit. Under PAYGO, Congress must pay for such legislation by reducing other entitlement spending or increasing other revenues" (cbpp.org).
As you can see by the chart included in Professor Zhao's deck for week 2 (slide 18), this rule began to reduce the annual deficit beginning in 1993. From 1997-2001 we enjoyed annual budget surpluses. PAYGO was allowed to expire in 2002, and we've had a deficit each year since then. Although a new version of PAYGO was enacted in 2007, it doesn't have the same restrictions as the 1990 law. "PAYGO doesn't force lawmakers to make the tough decisions needed to reduce the deficit, but it restrains them from making deficits worse or undercutting deficit-reduction efforts they have already enacted" (cbpp.org). When added together, all the annual deficits make for a mountain of national debt. The so-called Great Recession and the cost of bailouts compound the problem.
I believe it is imperative for the federal government and the American people to come to terms with the fact that there is no free lunch. We need to pay today for the programs and services we need, value and use, and stop borrowing from future generations.