The Republican Mania Over Cutting the Budget is a Giant Clusterf#ck – in 4 Parts

The new House majority promised to deliver $100 billion in spending cuts — and its members face the prospect of Tea Party primary challenges if they fail to deliver big cuts. Yet the public opposes cuts in programs it likes — and it likes almost everything. What’s a politician to do?

The answer, once you think about it, is obvious: sacrifice the future. Focus the cuts on programs whose benefits aren’t immediate; basically, eat America’s seed corn. There will be a huge price to pay, eventually — but for now, you can keep the base happy.

If you didn’t understand that logic, you might be puzzled by many items in the House G.O.P. proposal. Why cut a billion dollars from a highly successful program that provides supplemental nutrition to pregnant mothers, infants, and young children? Why cut $648 million from nuclear nonproliferation activities? (One terrorist nuke, assembled from stray ex-Soviet fissile material, can ruin your whole day.) Why cut $578 million from the I.R.S. enforcement budget? (Letting tax cheats run wild doesn’t exactly serve the cause of deficit reduction.)

Once you understand the imperatives Republicans face, however, it all makes sense. By slashing future-oriented programs, they can deliver the instant spending cuts Tea Partiers demand, without imposing too much immediate pain on voters. And as for the future costs — a population damaged by childhood malnutrition, an increased chance of terrorist attacks, a revenue system undermined by widespread tax evasion — well, tomorrow is another day. NYT – Krugman

There are 3 problems with the developing Republican plan, and a fourth if you reject their entire premise:

  1. Too many programs that benefit the young will be cut while entitlements and defense remain unrestrained or barely so, respectively.
  2. Americans don’t support defunding programs, and especially don’t seem to understand how much they benefit from existing programs.
  3. Republican lawmakers themselves seem to have little clue as to what they’re cutting.
  4. Fourth, there is no immediate crisis with our spending patterns. It’s long-term entitlements that can ruin everything.

The cuts are disproportionately future-oriented

As a person under 30, I’m not impressed with the Republican proposal and I don’t get it. There’s no clear public mandate to cut spending, check out the most recent Pew poll on budget cuts. The voting citizenry lacks the civic clarity to offer guiding principles, so Republicans have substituted their own. The Republicans view: all government programs are too big. Republicans want to bring us back to the age of tax-levying kings.

Throughout history, most of taxation has been used to build armies and pursue conquests abroad, or defend against those conquests. Republicans still seem whetted to that idea, because their definition for defense “cuts” is a reduction in growth of $7 billion. So, defense spending will still go up, just at a lower rate, while domestic spending must be cut by $44 billion. Instead, they cut money to pregnant mothers who can’t feed themselves. The idea of the public good, where programs are funded by the state for the good of different citizen groups, is a fairly recent, positive historical change. One that seems to be scorned by modern Republicanism.

Most Americans benefit tremendously from government spending

(The study) found that in 2004, a typical middle class family in the middle income quintile received $16,781 in benefits from the federal government. Bruce Bartlett

What’s truly nuts is recipients of government programs don’t even know that their participation is government-funded. Wildly, the recipients of some of the most famous government programs don’t know their participation is government-funded. If citizens that benefit from the most famous examples of government spending do not know it’s the government helping them, what does that say about smaller, less famous programs? Mindbogglingly, both Medicare and food stamp recipients show incredible levels of ignorance as to ownership. I don’t know how you can think those programs are anything but government assistance.

Percentage of Program Beneficiaries Who Report They “Have Not Used a Government Social Program”
Program “No, Have Not Used a Government Social Program”
529 or Coverdell 64.3
Home Mortgage Interest Deduction 60.0
Hope or Lifetime Learning Tax Credit 59.6
Student Loans 53.3
Child and Dependent Care Tax Credit 51.7
Earned Income Tax Credit 47.1
Social Security—Retirement & Survivors 44.1
Pell Grants 43.1
Unemployment Insurance 43.0
Veterans Benefits (other than G.I. Bill) 41.7
G.I. Bill 40.3
Medicare 39.8
Head Start 37.2
Social Security Disability 28.7
Supplemental Security Income 28.2
Medicaid 27.8
Welfare/Public Assistance 27.4
Government Subsidized Housing 27.4
Food Stamps 25.4
Source: Suzanne Mettler, “Reconstituting the Submerged State: The Challenge of Social Policy Reform in the Obama Era,” Perspectives on Politics (September 2010): 809.

Republicans are engaging in fast-acting groupthink, unaware of what they’re cutting

Republicans criticized the health care bill for being passed so quickly (though it took a year) and so they didn’t know what they were voting on. This could be because they didn’t care what they were opposing, as long as they opposed Obama’s plan. At any rate, they are not applying the same principle to their budget cutting mania, even though Republican freshmen are still asking basic budget questions like “What’s an appropriation?”

With many of the 93 freshmen members of the House still asking rudimentary budget questions such as: ‘what is the difference between an authorization and an appropriation?’ or ‘how do outlays differ from budget authority?’ the time frame that Rep. Rogers and his leadership are committed to means that not only will those voting on the proposal have little opportunity to understand it but the authors themselves will not have fully vetted or completely understood what they are proposing. Center for American Progress

The FBI will operate at 19% lower funding under the Republicans plan, because it wasn’t labeled as sacrosanct defense spending. Since 96% of the FBI’s budget is personnel, it would have to cut its law enforcement capacity to match the cuts that Republicans plan to mandate to government agencies. Republicans have spent less than 2 weeks trying to work this out, mainly within their own offices with no feedback from related agencies, and it shows.

Why are we even doing this?

Our short-term spending isn’t a problem, and can be fixed easily without cutting discretionary domestic programs that are both popular and effective. Deficits can be brought to the economist-approved 3% of GDP by letting the Bush tax cuts expire in full, and by levying a fairly small VAT (See The New American Economy – Bruce Bartlett). Or, we could actually cut the defense budget, which is operating at a higher percentage of GDP than the Cold War.

Especially in this era where economic recovery has only been felt in the earnings of Big Business and the long-term unemployment of the wider American citizenry is still over 9% of the workforce population, it doesn’t make moral or economic sense to cut domestic discretionary spending. With the Republicans primarily cutting domestic programs, it is vulnerable Americans who will lose the most.

And all politicians continue to make small budget squabbles seem important, when runaway entitlement spending caused by aging Baby Boomers is the true threat to American budget health.

The Congressional Budget Office (CBO) has indicated that: “Future growth in spending per beneficiary for Medicare and Medicaid—the federal government’s major health care programs—will be the most important determinant of long-term trends in federal spending. Changing those programs in ways that reduce the growth of costs—which will be difficult, in part because of the complexity of health policy choices—is ultimately the nation’s central long-term challenge in setting federal fiscal policy.” Further, the CBO also projects that “total federal Medicare and Medicaid outlays will rise from 4 percent of GDP in 2007 to 12 percent in 2050 and 19 percent in 2082—which, as a share of the economy, is roughly equivalent to the total amount that the federal government spends today. The bulk of that projected increase in health care spending reflects higher costs per beneficiary rather than an increase in the number of beneficiaries associated with an aging population.” Wikipedia

Ultimately, this is an unnecessary argument to be having, but the Republicans have some elusive mandate to cut programs that don’t solve long-term fiscal health, so the circus continues.

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2 Responses to The Republican Mania Over Cutting the Budget is a Giant Clusterf#ck – in 4 Parts

  1. olemike says:

    Why is it that all liberals think that “Raising Taxes” is the answer to everything? What’s wrong with a little fiscal frugality? The bigger government gets – the more it wastes.

  2. dcskeptic says:

    That’s assuming that government wastes money. From your individual perspective, maybe poor pregnant women don’t need as much government support, but I doubt that demographic feels the same way.

    The point I was trying to make isn’t that cuts are bad in principle, government should be responsive to programs that aren’t working. However, Republicans are cutting all domestic programs regardless of efficiency. Notice how defense spending, responsible for some of the most wasteful spending in government, won’t be cut. Republicans are just cutting domestic discretionary programs that do a lot of good, simply because they believe it’s time to cut programs, even though those programs are all extremely popular.

    I have no problem with cutting taxes in principle, I think the corporate tax rate is too high by comparison to other countries. But to make up the difference and still provide services that are good for citizens, you have to find the difference. Tax cuts categorically do not pay for themselves

    Furthermore, Republicans are completely ignoring the true budget-buster, more older people every year wanting their government-administered health care, but then not wanting to pay any more for it, and not even knowing that the government is responsible for the program they like.

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