Just a little while on the way home from work I was listening to Marketplace and what the people were saying annoyed me greatly. The host started the section my explaining to the audience all mater-of-factly that controlling our governments out of control budget was an essential goal for the President. However, he explained, the President actually only has control over a small portion of the budget namely “non-military discretionary spending”. He then explained that this was only about 1/6th of the budget. He then went on to introduce the Obama administration’s plan to create a spending freeze to limit all that discretionary spending.
He then brought on a guest to discuss the measure and the nature of budgets and deficits altogether. The guest, one of Marketplace’s corespondents I believe, explained quite confidently that Congress also doesn’t have much control over the budget outside of these non-military discretionary items and that’s why balancing the budget is so difficult.
Maybe… I just don’t understand budgets at all…. But to me the conjuction of these two statements just seemed totally odd. Crazy even.
Understand why this is so weird? Put the two statements together and you get that 5/6ths of the Federal Government’s Budget is controlled by…. no one!! Congress has no say over it. The President has no say over it. It’s like… the movement of the planets…. or the turning of the seasons, inevitable, unstoppable, timeless.
Of course that’s gotta be total nonsense doesn’t it? Those other 5/6ths of the budget conveniently under no one’s jurisdiction, aren’t they things like: interest on paying back loans, entitlement programs (Medicare and Social Security), and biggest of all Military Spending (about 50% of the overall)? At least those are the things the President’s budgetary freeze don’t effect. Those are the things off limits and not subject to budgetary cuts.
I always thought that the reality was that the President and Congress have total say over ALL areas of the budget including these areas. They may have made prior commitments to be sure, but surely any commitment made could be easily altered through passing a law through Congress and having it signed by the President. That’s how all government spending is essentially determined IF they choose not to cut those programs at all and cut others instead, it’s just that a CHOICE. Nothing forced them to not consider those areas for cuts. They simply didn’t WANT to cut any of those areas.
In reality if we really were serious and really did think deficits were a huge problem we would totally consider redesigning or restructuring medicare and social security in order to save money. Part of that might involve raising new taxes, part of it might mean rethinking how we distribute benefits. And it even might involve making cuts in benefits or privatizing components of the systems though I personally loathe both of those options. Still if we really thought getting control of deficits was priority number 1, Congress and the President would totally be looking into that and trying to figure out what is effective policy here and what is ineffective BS. OF course if they do that they have to keep an eye to ensuring that whatever are new programs are in entitlement spending that they remain reasonably humane.
If we were serious about cutting deficits we’d also have LONG AGO implemented a sane national health care system. Health Care costs are devastating the nation reducing our well being and our competitiveness. Furthermore, most good proposals to actually fix health care end up SAVING the government substantial amounts of money while at the same time saving individuals and families money and making our businesses more competitive. Thus good health care reforms are combination deficit reduction and stimulus and job creation. They’re essentially a win in all possible ways. Passing Health Care reform would have been and can still be a serious step in the right direction toward balancing the budget.
IF we were really really truly serious about cutting deficits we’d take not a knife but an AXE to our military budget. IT is by FAR the biggest source of our government’s spending and there is no rational reason for it to be. We don’t need to spend more on our military than the rest of the world combined. We don’t need so many foreign bases. We don’t need so many high tech weapons programs. It’s insane. We could safely half our military budget radically reducing our deficit and STILL be spending more than three times the amount of China who is the second biggest military spender in the world. And it’s not like they have less land or less people than we do to protect. And btw the gap in spending between us and the rest of the world has been growing. So it’s not like there’s any rational fear that those other countries might catch up any time soon.
But maybe in reality the marketplace report was inadvertently absolutely correct. It’s not technically true that congress and the President have no control over military programs or entitlement programs but maybe pragmatically it IS true. Maybe the sick and twisted reality that is Washington politics makes it so those areas Health Care, Social Security, Medicare, Medicaid, Homeland Security, the Military, etc. are simply untouchable because they are protected by overwhelmingly powerful special interests that have complete control over what our two branches of government can and can’t do. If that’s the case then it’s kindof a sad world we live in that that’s taken for granted as a unassailable truism that we should just accept as a precursor to any government policy discussion.
So of course we make a big show about cutting tiny programs relative to the size of the budget like farm subsidies, education spending, national parks, and federal government employee salaries as if that somehow makes a meaningful difference in our overall level of spending.
The spending freeze proposal Obama is expected to announce in his State of the Union address strikes me as the worst kind of self-destructive political maneuvering imaginable. It WILL demoralize his already incredibly demoralized base. As a result of this Obama now has popular columnists like Paul Krugman and Ezra Klein reacting in horror. Liberal economists around the country are groaning and shaking their heads. Liberal bloggers and talk show hosts are acting like they’re about to explode. So obviously this wasn’t done to appease the liberals.
Will it work better on the conservatives? No, it will not sufficiently ameliorate conservative democrats or republicans. The republicans have shown time and again that anything the President does is wrong in their book. And the plan isn’t comprehensive enough that it leaves them with no ground to run to to use for critique. They can if they choose, offer luke warm praise for “moving in the right direction” while at the same time demand he put the freeze into place sooner and make it bigger and more comprehensive. They will argue that Obama’s plan is too weak and too liberal and that it’s insufficient. They’ll demand that the President should ALSO stop spending on jobs programs, stimulus programs, and health care reform (completely ignoring any analysis of whether or not these actually help or hurt the budget). At the same time, they’ll no doubt demand he make cuts to social security and medicare as well and engage in Bush style tax cuts.
So if it’s not convincing consservatives and democrats, surely this program has to be targetting someone right? So maybe it’s for the middle class. Will it convince your average middle class American that Obama is being “responsible”? Maybe. I doubt it though. It will make cuts to popular programs that will easily be attacked by both the left and the right. And I think the average American will see right through this as the usual Washington posturing and politicking. They won’t see it as the CHANGE Obama promised and which we are all desperate for.
Worst of all for all this political damage what will Obama get for his attempt to be “responsible” in cutting the deficit? Will he ACTUALLY make a real difference in our long term deficit and debt level? No. The only way that will change substantially is if we made major cuts the Obama adminstration and congress are totally unwilling to do, or we substantially raised taxes which people are equally opposed to, or we get lucky and have an economic boom that we don’t squander. Will this ACTUALLY help bring about that last possibility and get us out of this recession? No. The only thing we have experimental evidence of that actually helps with recessions is the exact OPPOSITE of what President Obama is proposing, namely more smartly targeted government spending in the form of stimulating jobs programs or smartly targeted business promoting tax cuts. ie BIGGER deficits in the short term, not smaller ones.
So unless I’m just totally completely wrong the only result of this program will be an even more underfunded and consequently incompetent government and the return of a Republican controlled Congress which will most likely usher in another Bush like era. Or worse.
But of course as Marketplace tells us, the President and Congress have no choice!
Then again there’s a chance that all this is is just an elaborate silly bluff to score a few political points and no spending cuts will actually happen.
That I’m pretty sure would turn out to be even worse.