Just How Little The Budget Deal Matters in the Scheme of Things, in 3 Figures

As Peter Suderman notes, there's a new deal about the federal budget that's been hammered out by Rep. Paul Ryan (R-Wis.) and Sen. Patty Murray (D-Wash.). It needs to be passed by the House and the Senate, which may present some difficulties. The deal is supposed to save the country from the dread threat of "sequestration," or a series of automatic, generally across-the-board cuts imposed by the last budget deal, passed in the summer of 2011.

The short version of the deal, which covers discretionary spending over the next two years? The feds will spend $45 billion more in 2014 than they would absent a deal and another $20 billion more in 2015. Various "fees" (not taxes, never taxes!) will go up too, allowing Ryan and Murray to tout this as a plan to save "$28 billion over ten years by requiring the President to sequester the same percentage of mandatory budgetary resources in 2022 and 2023 as will be sequestered in 2021 under current law."

Thus the following table, which shows increases in spending from current law:

Whew, that was a close call, wasn't it? The truly minuscule trims to mandatory spending are unaffected, meaning that all the problems with major entitlement programs still exist and will only get worse. But the important thing is that we've avoided the "dumb" cuts imposed by sequestration that would have truly devastated discretionary spending, right?

Here's a chart by Reason columnist and Mercatus Center economist Veronique de Rugy that reminds us just how draconian the cuts imposed by sequestration really were:

She's updated the chart to make projections through 2023. The growth rate of spending, based on Congressional Budget Office (CBO) figures, shows that the sequester wasn't a big deal at all.

That's true even when you focus just on the base defense budget, which is the issue that arguably pulled the GOP to the table in the first place. The effects are larger on defense spending but, hey, the defense budget has been on steroids for most of the 21st centuy due to long and not-quite-over wars in Afghanistan and Iraq, plus a neverending war on terror. If past was prologue, defense spending would drop much more significantly as we at least announce the official end of our efforts overseas. Not quite the case:

There's a real question as to whether this Ryan-Murray deal will get the votes needed to pass in Congress. But as a rough approximation of what the two major parties want out of a deal, it underscores that spending only goes down by accident. Remember that President Obama put sequestration into play precisely as a trigger to make sure that a bipartisan deal to spend more money would get done.

Real federal spending has indeed flattened over the past few years, partly because of the sort of gridlock that led to sequestration and partly because it had been jacked up for so long and then with a giant burst at the very end of the Bush presidency and the start of the Obama years. Here's a bonus chart, also courtesy of de Rugy, that shows the general trend over the past several decades:

If you care about shrinking the size, scope, and spending of government - and you should if you care about "Free Minds and Free Markets" both - there's not a lot of reason to cheer this latest deal and, even more sadly, what might eventually replace it. Because as the chart above shows, there doesn't seem to be a lot of ability to flatten spending, at least since World War II, for any length of time.

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  • gaijin||

    by requiring the President to sequesterthe same percentage of mandatory budgetary resources in 2022 and 2023

    Which president?

  • wareagle||

    that is the kind of thing where DC admits it believes we are stupid. It's like spending plans that presume to hold future Congresses accountable to what passed today, a tactic with such a great history.

  • some guy||

    ::cough:: Doc Fix ::cough::

  • Gilbert Martin||

    " I will gladly repay you Tuesday for a hamburger today".

    That's fed gubmit management style for ya - just like a Popeye cartoon character.

  • ||

    Seems bad form for the first comment to be OT but it is related.

    From 24/7;

    "A man who provided sign language interpretation on stage for Nelson Mandela's memorial service, attended by scores of heads of state, was a "fake," the national director of the Deaf Federation of South Africa said ....."was moving his hands around but there was no meaning in what he used his hands for,....... Jackson Mthembu, spokesman for the governing African National Congress party, declined to comment. "Government will be able to assist you," Mthembu said."

    I am sure they will assist us, just not in the way they claim.

    There you have it. Government in a nutshell.

  • gaijin||

    Seems bad form for the first comment to be OT but it is related.

    It's not the first comment, so no worries ;)

  • General Butt Naked||

    ..."was moving his hands around but there was no meaning in what he used his hands for,...

    This made me laugh. It sounds like a gag in a Naked Gun movie.

  • pan fried wylie||

    Wasn't there a signing gag in one of them? Coffee has yet to reach the movie trivia part of my brain...

  • Scruffy Nerfherder||

    Seems appropriate for a political gathering.

  • Red Rocks Rockin||

    That last chart really needs to be updated. There's inflation calculators online that will put the figures at 2013 levels.

  • Certified Public Asskicker||

    allowing Ryan and Murray to tout this as a plan to save "$28 billion over ten years

    CPA weeps.

  • Steve G||

    Nick, you SF'd the donate link...

  • Certified Public Asskicker||

    I give by donating internet traffic.

    Your welcome Gillespie.

  • Certified Public Asskicker||

    Oof, *you're

  • The Late P Brooks||

    But at least we won't have the crushing burden of the sequester dragging us down and smothering the economy as it gasps for breath in its crib.

    Let there be rejoicing in K Street.

  • Smilin' Joe Fission||

    OMG REASON IS ABOUT THE CROSS THE MONEY DRIVE THRESHOLD!!!!

    I wonder what life will be like after the Reason has made its nut. One can only imagine...

  • R C Dean||

    I wonder what life will be like after the Reason has made its busted a nut.

    More squirrelz?

  • ||

    there doesn't seem to be a lot of ability to flatten spending, at least since World War II, for any length of time.

    I like Ike!

  • The Late P Brooks||

    a plan to save "$28 billion over ten years

    When you're spending a trillion dollars or more per year, that's like eliminating that green bean casserole thing from your Xmas dinner for ten years. Crushing austerity budget forever!

  • Scruffy Nerfherder||

    Think of those people who depend on the green bean casserole for sustenance! And think of the green bean farmers who struggle every day to survive! And don't forget about the Pyrex manufacturer who has pension obligations to fulfill!

  • W. Manly Firmness||

    Greetings. Good article. Editor, please correct the spelling error: It's minuscule, not miniscule.

  • Dave Krueger||

    Hey, that's how I do my budget, too. I figure out all the stuff I want to buy and then cap spending at that level (unless an emergency need arises, like I see something I want on ebay).

  • R C Dean||

    Still dishonestly attributing to Bush all the 2009 spending passed after he left office, I see.

  • Harun||

    The Dems specifically waited for Obama to sign that spending,

  • timb||

    I love it with Fonzie mentions "that all the problems with major entitlement programs still exist and will only get worse," 'cause I recognize his goodwill in seeking to fix the problem. Not that his entire professional life has been one of trying to eliminate them. No, he just wants them fixed.

    Such a well-meaning guy

  • NDme||

    While I agree that this is just another spend now for not exactly mandatory cuts later, I must point out that the charts you use from George Mason University incorrectly show Obama's Stimulus as part of a Bush spending year. Not related to the article, it's just annoying to see those false numbers put out there making it look like an extra trillion was added to the baseline budget before BO came into office.

  • ||

    This is not just George Mason's fault. The Democrats have were intentional in adding a trillion to Bush's FY. This way they claim credit for the good things and blame Bush for the bad.

    It also allows them to claim how much they have cut the deficit.

    DO NOT TRUST DEMOCRATS USING MATH. Okay the using math is redundant. So it would be better to say "Don't trust math done by Democrats."[

  • DDosCapitol||

    In 2010 the Tea Party Conservative/Libertarian coalition gave the GOP another chance to earn the trust that previous GOP Congresses had squandered. We trusted their mea culpas and their "We're a changed party" 12-stepper rhetoric.

    Now Paul Ryan staggers in at 2:30am reeking of tax dollars with Patty Murray's lipstick all over his earmarks with his binge-spending buddies Boehner and Cantor making excuses about how the car broke down in front of the IRS and they just went in to use the phone, but...

    These clowns won't learn and won't stop insulting our intelligence. Stop fiscal co-dependency. We need to kick these boozers to the curb and start dating again.

  • Anvil||

    YAY FOR BI-PARTISANSHIP!!!

  • Duelles||

    " what difference does it make, now." Well, when is a revenue enhancement a spending cut. These bastards lie and manipulate. I' m so happy to have spent my working years as a greedy free market capitalist that I currently have enough money in retirement. But still. . . . I thought that perhaps Sequestration was ' settled law' therefore untouchable.
    I was wrong! So now to figure out how to make money off the deal, or a least determine how my Senators and congress men are trading stocks on their info.

  • ibcbet||

    These clowns won't learn and won't stop insulting our intelligence. Stop fiscal co-dependency. We need to kick these boozers to the curb and start dating again.

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