The Energizer

Rep. John Kasich got House Republicans to agree on spending cuts. How far can he lead the revolt?

It's a humid May afternoon. In the dark basement of a packed Capitol Hill restaurant, Ohio Rep. John Kasich, the ranking Republican on the House Budget Committee, talks to a group of conservatives about budget reform. Though most of his 70 listeners are sympathetic, and not even his constituents, Kasich treats the speech like a campaign event. Speaking without notes, he becomes part policy wonk, part Dale Carnegie disciple, part stand-up comic.

In the style of Ross Perot, Kasich holds up a colorful chart with bar graphs that spell out how the proposal Republicans on his committee developed will cut the deficit more than Bill Clinton's budget. Then, in mock exasperation, he pauses and says, "Even under our program, we're bankrupting America."

Ross Perot, Warren Rudman, and Paul Tsongas have begun to convince millions of Americans that the federal deficit is a moral outrage. In February, when Bill Clinton called for "deep cuts in existing government programs"—surprise!—people agreed. For the first time since the Eisenhower administration, real spending cuts are possible.

But Clinton's budget outline, which claimed to cut the deficit by $473 billion over five years, relied mostly on tax hikes. When the president challenged critics either to get on board or to come up with a specific alternative plan, Republican leaders opted simply to gripe.

Kasich and his 16 Republican colleagues on the Budget Committee decided to call the president's bluff, however. In less than a month, they and a couple dozen staffers developed an item-by-item alternative that accomplished what Democrats and pundits said was impossible: It would reduce the federal deficit by more than Clinton's plan—$479 billion over five years—without raising taxes or affecting Social Security. The Republican plan spends $233 billion less than Clinton's, making the GOP deficit figures more credible.

"Kasich did the impossible. He got conservative, liberal, and moderate Republicans to agree to spending cuts," says Matthew Kibbe, budget associate for Rep. Dan Miller (R-Fla.). "Kasich was the first person on the Hill to realize that people will consider specific spending cuts."

Like the tax revolt that fueled Ronald Reagan's bid for the White House, a revolution against government spending may be starting to rumble—and it, too, will need an identifiable leader. For now, at least, 40-year-old Kasich looks like the most likely prospect. After putting together three earlier budget alternatives in relative obscurity, he has become a Washington celebrity.

Friends and professional acquaintances compare Kasich favorably with David Stockman (for his grasp of the complexity of the budget), Reagan (for his populist approach to limited government), and the Energizer Bunny (for his frenetic working style). In January, the influential weekly National Journal named Kasich one of Washington's rising stars.

The brash, assertive Ohioan has made an impression, especially on his less-experienced colleagues. Kasich "has galvanized the Republican party and focused it on economic issues," says a freshman House Republican. "He's also made [Minority Leader Bob] Michel a one-termer."

Kasich's first budget-cutting experience came as a state senator in Ohio. In 1978, four years after graduating from Ohio State University, Kasich unseated a veteran Democrat by visiting every home in his Columbus senate district at least once.

Mary Anne Sharkey, politics editor of the Cleveland Plain Dealer, was the newspaper's Columbus bureau chief at that time. "John was thought of as a smart-alecky kid," she says. "He was the type of guy who would go to the floor of the Senate and make a speech on any topic."

In 1980, Ohio's $4.9-billion budget was $400 million in the red. The state constitution requires a balanced budget. The legislature planned a tax increase. "I didn't want to raise taxes," Kasich says. "[My opponents] said, 'You're being irresponsible,' which is what they say every time you don't want to vote for tax increases in politics. So I put my own budget together." Kasich proposed $400 million in spending cuts.

His budget alternative didn't pass, but his efforts got the attention of his constituents, a mixture of affluent suburbanites, blue-collar Republicans, and Reagan Democrats. In 1982, he won a seat in the U.S. House of Representatives—the only Republican that year to unseat an incumbent Democrat who hadn't been gerrymandered out of his district. Kasich, says Sharkey, maintains "a real understanding of the lunch-bucket crowd."

House staffer Kibbe, a former Republican National Committee economist, concurs. He calls Kasich "the first Republican since Ronald Reagan to put a populist spin on limited government. He constantly talks about how markets help normal people and how government hurts normal people."

During the budget debate in March, Kasich went on the House floor to excoriate Clinton, who promised during the campaign to raise taxes on only the rich. "There are only two sets of people being taxed in America under [Clinton's] plan," Kasich told his colleagues. "Millionaires and anybody who drives a car or breathes a drop of air."

"When the American people pull into the filling station and pay higher gas taxes," he warned, "and when they find out [the taxes are] not being used to reduce federal spending [but are] being used to build a bigger Washington, D.C., that is when you are going to find out about the outrage."

Deficit reduction sounds easy. Just pass a balanced-budget amendment, or spending caps, or a deficit-reduction plan like Gramm-Rudman-Hollings. No problem.

Such procedural reforms are important. They set limits on overall government spending and permissible levels of debt. When times are good and government revenues surge, a freeze on new spending or a cap on the growth rate of some programs might get the deficit down. But when a slow economy retards tax collections, the president or congressional leaders must go through the budget line by line, find specific programs to cut, and explain why.

This is no simple job, even when a big-government opponent like Ronald Reagan occupies the White House. Norman Ture, president of the Institute for Research on the Economics of Taxation, was undersecretary of the Treasury in the first Reagan term. Enacting spending cuts is difficult, Ture says, because every government program explicitly benefits somebody, and "most people probably couldn't name 15 line-items in the entire budget."

Ture recalls a conversation he had with then-deputy budget director Lawrence Kudlow. "I asked Larry why he couldn't go through the budget, pick a few programs, explain why they were unnecessary, and just eliminate them. Larry told me there weren't enough resources in the [budget office] to do it."

Kasich's Republican alternative, then, is a remarkable accomplishment. For starters, there's motivation: Since hyperactive Democrats control both ends of Pennsylvania Avenue, they have the votes to ram through any package of taxes and spending they please. Why would Republicans, who could never pass their own budget, waste their time proposing specific cuts? It would have been easier to carp at Clinton.

The Republicans were also outgunned. Clinton could call on more than 500 employees at the Office of Management and Budget, plus the 23 Democrats on the Budget Committee, their 23 budget associates, and the 50 permanent Democratic Budget Committee staffers. By contrast, the Republicans have 17 committee members, their budget associates, and a dozen staff members and interns.

In addition, congressional Democrats announced they would vote on Clinton's budget in mid-March, a couple of months earlier than usual. The Republicans had to move fast.

Kasich decided to ask his Republican colleagues to go ahead anyway. "To just sit back and criticize Clinton without a manageable, credible alternative is a dreadful mistake," he told them at a committee meeting. "We didn't come here to be potted plants."

Kasich divided the Republicans into seven working groups: national security; economic growth/budget process; health-care reform; human empowerment (a.k.a social services and entitlements); physical capital (transportation and housing); natural resources and science; and government management. They first tried to propose a five-year budget that reduced net spending in every area except health care, where they tried to cut spending growth. Their long-term goal: a balanced budget.

Committee members and staffers say they treated their meetings as seriously as if they were putting together a budget that might pass. Not everybody got what he wanted. For instance, Clinton had proposed $57.1 billion in agriculture spending over five years. Freshman Rep. Miller of Florida says he urged the Republicans to spend less than Clinton, but to no avail. The Republicans proposed $61.7 billion for farms.

Similarly, some committee members asked for defense cuts comparable to Clinton's unspecified $112 billion in reductions. At Kasich's insistence, however, the Republicans agreed to no more than $60 billion in cuts.

In early March, each member brought his own proposal to a meeting at which they "marked up" the Republican alternative. "All 17 of us sat around a table and traded off for six-and-a-half hours," Kasich says. His goal was a budget proposal all the Republicans would back. In the end, only freshman Rick Lazio of New York didn't sign on.

The Republican budget highlights the ideas of empowerment: provide more services for less money while giving individuals more choice. For Medicaid, the committee borrowed Arizona's managed-care program, which enrolls welfare recipients in health-maintenance organizations. To cut spending on public housing, they resurrected one of Jack Kemp's favorite ideas: Stop building new public-housing units (and paying for the maintenance they require) and give tenants housing vouchers to shop for privately owned apartments.

The proposal includes a plan Rep. Chris Cox (R-Calif.) introduced in 1991, which divides the budget into well-defined categories, sets caps on how much Congress can spend on each category, and requires super-majority votes before it can spend more. And it contains the debt buy-down measure proposed last year by Rep. Robert Walker (R-Pa.) and endorsed by George Bush. The Walker plan would let taxpayers use their tax returns to designate as much as 10 percent of their income-tax payments to reduce the federal debt; unlike Clinton's deficit-reduction "trust fund," the Republican proposal requires mandatory dollar-for-dollar spending cuts to match the 1040 check-offs.

The program also halts federal land purchases for five years, abolishes the Interstate Commerce Commission, and prevents military retirees from getting cost-of-living increases until they reach age 62. "You don't have to invent every idea," Kasich says, "as long as you don't claim it's your own."

On March 11, the day after Budget Committee Republicans presented their plan, a New York Times editorial said the proposal "calls Mr. Clinton's bluff, and deserves a serious airing." House Democrats did not agree. Inside the committee, the Republicans proposed 29 separate amendments to cut spending. Each was voted down unanimously by the Democrats.

The Clinton budget outline passed in March. But that didn't mean much. Clinton has to get the budget itself—specific taxes and spending items—through the House and Senate this summer. The House Republican alternative made an immediate impact: The day committee Republicans announced their plan, congressional Democrats proposed $63 billion in additional unspecified cuts to match the GOP challenge.

The Republican proposal also made the White House take spending-cut fever more seriously. Just before the May 27 House budget vote, such centrist Democrats as Rep. Charles Stenholm (Tex.) and Sen. David Boren (Okla.) brought forward their own deficit-cutting plans, which would have eliminated most of the president's proposed tax hikes.

While Kasich championed the Republican alternative on the House floor, Clinton and his allies worked feverishly to keep enough Democrats on board to pass his budget. Commenting on the arm-twisting Clinton had to employ, Rep. Charles Taylor (R-N.C.) said, "You can hear bones breaking all over the place. It sounds like a chiropractor's office." Clinton finally won the vote, 219-213, but lost 38 House Democrats in the process. As this story goes to press, senators and representatives are home for their Memorial Day recess, talking to constituents and facing three more budget votes upon their return.

Cox says Republicans will use their budget plan to haunt Clinton and the big-spending Democrats. "At every turn," he says, "we will confront Clinton and his liberal allies with the chasm between their promises and their new deficit spending."

John Kasich may have labored in obscurity before the budget battles made him famous. But his wasn't really an overnight success. This wasn't even Kasich's first attempt to cut the budget. In 1989, his first year on the Budget Committee, he proposed a freeze on defense and discretionary spending. It got 30 votes. His 1990 alternative got 106 votes. By 1991, his option had received 114 votes, more than President Bush's.

Nor did he make his name as a partisan Republican. Until he won the ranking Republican's position last December, most of the outside attention he had generated was for his work with liberal Democrats. He joined with Pat Schroeder (Colo.) to reform the Joint Chiefs of Staff, Ron Dellums (Calif.) to cut funding for the B-2 bomber, and Barney Frank (Mass.) and Charles Schumer (N.Y.) to cut farm subsidies.

His biggest successes were on military issues. When he got to Washington 10 years ago, Kasich sought only one committee appointment: Armed Services. ("I wanted to be able to 'free lance' on other issues," he says.) A supporter of the Reagan military buildup, he nonetheless considers himself a "cheap hawk." On Armed Services, he worked with Democrats who wanted to root out the dreaded $600 toilet seats. "Unlike a lot of conservatives," he says, "I think the Pentagon needs the same scrutiny as other [government] departments."

In 1986, over the opposition of Defense Secretary Caspar Weinberger, Congress passed the Goldwater-Nichols Reorganization Act, the most sweeping military reforms since the Truman administration. Before these reforms, the Joint Chiefs of Staff had been a formless committee that spent much of its time protecting the turf of each armed service. Critics of the Pentagon blamed the military's "cover your ass" mentality for permitting weapons cost overruns and for disasters like the botched attempt to release the Iranian hostages in 1980.

The Goldwater-Nichols bill made the chairman of the Joint Chiefs the principal military adviser to the president and gave the chairman more authority to direct the operations of the armed forces. The seamless coordination of U.S. armed forces during the Gulf War was one visible result of this Pentagon reorganization. To push these reforms past the Pentagon establishment, dovish Democrats like Schroeder had to have the support of congressional hawks—Sens. Barry Goldwater (R-Ariz.) and Sam Nunn (D-Ga.) and Rep. Bill Nichols (D-Ala.). Kasich was the critical House Republican.

He also navigated the military base-closing bill through the Armed Services Committee. Rep. Dick Armey (R-Tex.) got credit for developing the plan, which set up an independent commission to list which bases to close and requires Congress to close all of the bases or none of them. But Armey wasn't on the Armed Services Committee; Kasich was.

Kasich praises the open, bipartisan spirit of the Armed Services Committee. In contrast with the Budget Committee, he says, "we always tried to accommodate one another." He says Armed Services Democrats always told him, "If you've got a good idea, great, let it shine." That's the spirit with which he rallied his own party's coalition on the budget.

Back in his office, an hour after the lunch (which he didn't get the chance to eat), Kasich munches on a grilled cheese sandwich and bean soup while we talk. Last year rumors had him running against Democratic Sen. John Glenn; now he's supposedly facing Sen. Howard Metzenbaum next fall. Congressional staffers and a couple of junior members I talked to see Kasich as a potential party leader in the House.

I ask Kasich about his ambitions. He brushes the speculation aside. Sort of. "All I'm worried about now is, am I going to get my workout in tonight?" he laughs.

After working in obscurity for a decade, Kasich is finally attracting attention. Why? "Now I have a title," he says. "In this town, it's not always what you say, it's where you say it from." The new-found attention, he says, means that reforms eventually may be possible.

Eventually is the operative term. If there is a spending revolt on the horizon, he says, it hasn't yet dawned on the members of Congress. But that may change.

Outside the Beltway, Kasich says, Americans are growing tired of a government that taxes too much and still can't pay its bills. "People in this country think government stinks," he says. "They don't want it messing with their lives. They want to see this stuff changed, cut back, fixed. We're not Santa Claus here."

Rick Henderson is Washington editor of REASON. Intern Claire Chatelin provided research assistance for this article.