For the Budget Crisis, a Fake Solution
The trouble with Obama's State of the Union
Spring is months away, but bipartisanship is blooming in Washington. Amid a terrible fiscal crisis, President Barack Obama and Republicans have come to a historic accord on the budget. They are agreed on a fake solution.
The big news from Obama's State of the Union address is his plan to freeze discretionary spending on non-security programs for five years. This category includes such things as education, transportation, national parks, job training, and environmental protection. His idea echoes a proposal from the conservative House Republican Study Committee to impose a freeze for a decade, after rolling outlays back to the 2006 level. The House itself passed a resolution this week more or less embracing the latter approach.
A five-year or 10-year freeze on anything sounds serious. In reality, these recommendations amount to a charming ruse.
One reason is that this slice of the budget accounts for only one-seventh of all federal spending, and it's not growing. In fact, the Congressional Budget Office projects that by 2015, without a freeze, it will be at its lowest level as a share of GDP since 2001.
Freezing non-security discretionary spending is like rounding up everyone on The Biggest Loser and putting the trainers on a diet. The payoff is likely to be small and certain to be irrelevant.
Talking about this type of action is even less useful. But that's what Obama and Congress have been doing for the past year. In his 2010 State of the Union address, the president proposed a three-year freeze on these programs. So far, that idea has sat on the shelf.
The latest Obama plan would cut projected outlays by an estimated $400 billion in the next decade, and the Republican alternative would cut spending by $2.5 trillion. It's a measure of our predicament that these enormous sums wouldn't make a lot of difference, even if they were achieved. They're the equivalent of trying to empty a swimming pool with a tablespoon.
The Concord Coalition, a nonpartisan fiscal watchdog group, estimates that given current policies and trends, the cumulative federal deficit over the next decade will amount to about $15 trillion. So if the Republicans actually got their version enacted, we would add some $12.5 trillion to the national debt by 2021. This heroic feat of fiscal discipline would leave taxpayers with nearly twice as much government debt as today.
That's not the only flaw. Another is that both parties are mostly silent on which programs will be downsized. It's easy to inform the public that the government will spend less than it planned next year. The hard part is telling ordinary citizens which benefits will be pried from their cold, dead hands.
Then there is the matter of bombs and bullets. Neither party is prepared to reduce our military budget, which has grown by a staggering 45 percent in inflation-adjusted dollars over the past decade—not counting the cost of our two wars.
House Budget Committee Chairman Paul Ryan's "Roadmap for America's Future" presents an ambitious blueprint for fiscal balance. Amount he would squeeze from the Pentagon: zero. Obama wants to "cut" defense outlays, but only in the sense of not letting them grow quite so fast.
But the biggest part of the bipartisan fraud is the refusal to deal with the outlays that are out of control. The Congressional Budget Office notes that "almost all of the projected growth in federal spending other than interest payments on the debt comes from growth in spending on the three largest entitlement programs—Medicare, Medicaid, and Social Security."
At the rate they are growing, the federal government will spend as much on them in 2050 as it spent on everything 10 years ago. Unless they are restrained, our leaders can save a lot of money elsewhere and accomplish nothing. If you're driving toward a cliff, slowing down will delay the crash, but it won't improve your fate.
The beauty of this approach is that it lets politicians look tough on spending without antagonizing an inordinate number of voters. The shortcoming is that it leaves the debt crisis to keep growing.
Obama admitted Tuesday that to make real progress, "we have to stop pretending that cutting this kind of spending alone will be enough." But really, our leaders have just begun to pretend.
COPYRIGHT 2011 CREATORS SYNDICATE, INC.
