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Free Minds & Free Markets

Divided Government Means More Fiscal Discipline

In the next two years, Congress will probably do next to nothing. That's a good thing.

Are you ready for some stalemate? Over the next two years, Washington deliberations will resemble one of those 1960s-era football games in which moving the ball was hard and touchdowns were rare. This will not be the irresistible force meeting the immovable object. It will be two immovable objects.

The old maxim says the best government is the least government. Whether that's true or not, I no longer harbor innocent dreams of best government. I will settle for least bad government, and that generally means divided government.

In the next two years, Congress is not likely to do much right, but it's also not likely to do much wrong. It will probably do next to nothing, which—considering the occupant of the Oval Office—is preferable to the alternative.

Republicans no longer enjoy a monopoly on power. On Election Day, they kept control of the Senate but lost the House—inviting Democrats to obstruct, delay, and frustrate Donald Trump's legislative priorities, assuming he has any.

Gridlock will grow more pronounced. But what's the downside? It's not as though much got done when the GOP was in complete charge.

Republicans failed to repeal the Affordable Care Act as they had long promised. They did nothing on immigration. Trump's border wall still exists only in the giddy dreams of his more naive rallygoers.

The president proclaimed a couple of "infrastructure weeks," which fell so flat that they became a synonym for irrelevancy. His renegotiated NAFTA has not been approved by Congress and may never be.

About his only real legislative accomplishment was the package of tax cuts enacted last year. It won passage because it united Republicans in a familiar and beloved Washington pastime: abandoning fiscal discipline and piling up debt for future generations to carry.

The Republicans' dominance allowed them to pass the tax bill entirely on their own. No Democrat in either house voted for it.

From a fiscal standpoint, it amounted to a raucous party that will produce a brutal hangover. Thanks in part to this bacchanal, the Congressional Budget Office predicts that federal debt will grow by $13 trillion by 2028.

The good news about our newly divided government is that this sort of reckless extravagance will now be harder to engineer. Democrats are not about to go along with any tax cuts that Republicans would want. So a measure of fiscal responsibility could make a comeback.

That's the historical pattern when power is split between the two parties. It was during a period of divided government in the 1990s that our elected officials took the steps needed to produce actual surpluses in the federal budget. For a few years there, believe it or not, the government spent less money than it took in.

The late William Niskanen, who headed Ronald Reagan's Council of Economic Advisers, detected a pattern. In the years since World War II, he noted in 2006, the only periods of fiscal restraint were "the last six years of the Eisenhower administration and the last six years of the Clinton administration, both intervals in which the opposition controlled Congress." Spending grew three times faster under unified government, he found, than under divided government.

This formula held under Barack Obama. "Virtually all net spending increases during the Obama administration were enacted during 2009-10, when Democrats controlled Congress," writes Brian Riedl, a budget analyst for the conservative Manhattan Institute. After the GOP took over the House in 2011 (and the Senate in 2015), it curbed his plans.

In Obama's final six years, nearly $900 billion in spending cuts were signed into law. "The fiscal restraint from 2011 through 2016 resulted from gridlock," Riedl concludes—and the gridlock came from you-know-what. But Republicans are better at forcing budget restraint on Democratic presidents than on Republican ones.

Over the decade ahead of us, the deficit will keep growing regardless, thanks to past tax cuts, rising interest payments, increases in defense spending, and the growing costs of Social Security, Medicare, and Medicaid. Attacking those causes, granted, will be even harder with the split in Congress. But let's not kid ourselves. Congress has ignored them over the past two years, and odds are it would have kept doing so even with a Republican House.

Our leaders have shown little inclination to take the steps needed to make the fiscal situation (or much else) any better. Now, at least, it won't be so easy for them to make it worse.

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  • Sevo||

    Pest control is what we need in Congress. It should pretty much empty the place.

  • DiegoF||

    That was a hell of a First. And yours was a hell of a Second.

  • TuIpa||

    And you're hell of a fucking moron who makes an metric assload of predictions, gets most of them wrong, and then lies about it post facto, while simultaneously crowing about getting literally the most obvious shit correct.

    No moron, your shitty Nate Silver impersonation didn't lead you to make better predictions than me, and your lying about it to protect your sad fucking ego is pathetic.

  • Ordinary Person||

    Trump is going to want to spend huge sums of borrowed money to prop up the economy in the short term so I'm not sure you're right about fiscal gridlock.

  • JesseAz||

    The Obama plan? So you're ignorant of truno having his agencies identify ways to cut spending just last month? It's the assholes in Congress who passed a veto proof appropriations bill this year.

  • TuIpa||

    Why did you change from your sockpuppet?

  • Rebel Scum||

    prop up the economy in the short term

    So you're saying he's the same as Barry in that regard? ///toobigtofail

  • Wise Old Fool||

    I'm guessing that democrats want to spend a ton on infrastructure and so does Trump, so I think that there will be a lot spent there. The farm bills always get supported. Military increases are almost always approved. I doubt much will change.

  • gaoxiaen||

    YAY! Gridlock.

  • Last of the Shitlords||

    Yep. Any chance of meaningful budget cuts, however slight, are now gone.

    Nothing left to cut!

  • Wise Old Fool||

    There was never a chance for that.

  • gaoxiaen||

    YAY! Gridlock.

  • tlapp||

    I'd like to think so but often it becomes you vote for mine I vote for yours spending free for all. All needed to pass any spending bills or the threat of the government shut down and who gets the blame.

  • Liberty Lover||

    I'n not sure, but I think the last time the US government had fiscal responsibility was under the Articles of Confederation.

  • Gilbert Martin||

    The national debt was paid off during the Andrew Jackson administration.

    That was the only time that in United States history that the debt was paid off.

  • tlapp||

    Yes and he ended the first central bank. I think they put him on the $20 bill as a slap in the face, not an honor.

  • Liberty Lover||

    Thanks for the info. I was being facetious when I picked the articles of confederation though, as that was before our current form of government.

  • JesseAz||

    Sometimes I wonder how naive reason writers are... trump reduced government regulations the last 2 years. He didn't reduce spending because he was sent appropriations that passed well above the two thirds veto override... Hint this was bipartisan spending. Under the last divided government we used baseline budgeting which has its own high spending growth rate. Now we will have house Democrats spending wildly on investigations.

    Sorry Nick, you're a fool. Payment on debt is even about to pass defense spending. East coast conservatives are already talking about expanding entitlements. This election ended hopes of sane government growth

  • Barrie||

    Nick who?

  • loveconstitution1789||

    Its Chapman. Understandable as Gillespie writes nonsense too.

  • Wise Old Fool||

    Gillespie is smarter and more on point than 99% of the fake libertarians (read GOP infiltrators) in the comment section.

  • Tankboy||

    I'm always surprised that the electoral struggle between the party of pure evil and the party that wants only the best for the American people results in a difference of just a few thousand votes. It's almost like there was no real difference between the parties.

  • antiestablismentarianism||

    Libertarians have never been that close in votes! Oh, you're talking about one of the major parties aren't you? Which one is the party of pure evil again? Ha, trick question, they both are! You are actually claiming that one of the two major parties wants only the best for the American people? Can I get some of what you're smoking?

  • loki||

    "In the next two years, Congress is not likely to do much right, but it's not likely to do much wrong."


    Nah. I'm sure they'll agree on plenty of wrong, and do that.

  • Last of the Shitlords||

    Chapman is a very stupid person, and writes very stupid things.

  • loveconstitution1789||

    In the next two years, Congress is not likely to do much right, but it's also not likely to do much wrong. It will probably do next to nothing, which—considering the occupant of the Oval Office—is preferable to the alternative.

    Chapman is against the few rollbacks of government Trump was able to get the GOP to pass.

    For Chapman, its counting the days until election 2020 when he thinks Trump WON'T be reelected.

  • antiestablismentarianism||

    This is going to hugely depend on who the Democrats choose to go against him. Here's some names I think will guarantee a Trump reelection: Maxine Waters, Kamala Harris, Cory Booker, Diane Feinstein, Nancy Pelosi, Bernie Sanders, Oprah Winfrey, Kirsten Gillibrand, and of course, Hillary Clinton. Some Democrats whom I think may have a shot: Evan Bayh, Lindsey Graham (technically independent), Steve Bullock, John Delaney, and Elizabeth Warren (maybe)

  • Juice||

    Just want to comment on the odd phrasing of "final 6" out of 8.

  • tlapp||

    Yet spending increased every year even with the sequester. The beauty of government's accounting practices.

  • loveconstitution1789||

    Republicans failed to repeal the Affordable Care Act as they had long promised. They did nothing on immigration. Trump's border wall still exists only in the giddy dreams of his more naive rallygoers.

    Trump has all sorts of Legislative agenda items. Lefties like Chapman are against every one. Democrats, Socialists, and RINOs voted against every one or never brought the roll backs to a vote.

    Trump has been enforcing immigration law but Chapman would rather Congress stop that.

    Poor Lefties like Chapman. Butthurt until 2024, when Democrats can put another loser candidate forward to lose.

  • loveconstitution1789||

    Poor Buttplugger is really upset Georgia's new Governor, Brian Kemp, is Republican.

    Poor Buttplugger just has so many sads each day.

  • loveconstitution1789||

    In Obama's final six years, nearly $900 billion in spending cuts were signed into law.

    Chapman does not post citations because "spending cuts" were actually promises to spend less in future budgets not actual cuts to the current yearly budget.

    Chapman is just one of those propagandists that will never fit in here. Too many Libertarians left to challenge the Anarchists running the place and Lefties who try and derail Libertarianism.

  • Dillinger||

    >>>Bedget Control Act of 2011

    down with mattress quotas!

  • Rebel Scum||

    spend less in future budgets

    Was there even a budget during Barry's terms?

  • Francisco d'Anconia||

    Oh, I'm sure the Rs and the Ds can find something they can agree to spend our money on...

    IFRASTRUCKSHURZ!

  • Dillinger||

    T gets to show (D) side w/o blowback?

  • Rebel Scum||

    Divided Government Means More Fiscal Discipline

    LOL

  • Mickey Rat||

    It is a bit of a naive assumption that a House controlled by Democrats with Trump as president is going to motivated to behave the same as a GOP House with a Democrat.

    Also, the biggest bitch being that the inefficient tax code was modified to be more friendly to economic growth.

  • Tony||

    Apparently the fat orange dotard can spend a quarter billion dollars sending troops to protect us from Honduran refugees without any help from Congress.

  • Rebel Scum||

  • Gilbert Martin||

    "About his only real legislative accomplishment was the package of tax cuts enacted last year. It won passage because it united Republicans in a familiar and beloved Washington pastime: abandoning fiscal discipline and piling up debt for future generations to carry."

    As long as the federal government spends so much as one cent on any activity that James Madison did not consider to be within the enumerated powers delegated to the federal government in the text of the Constitution then all deficits are entirely due to too much spending and never too little taxation.

    And by the way, the next time someone starts blovating about putting burdens on future generations, ask them if they are
    willing to immediately eliminate social security and medicare as those programs are EXPLICITLY designed to do exactly that in perpetuity.

  • Tony||

    Actually they're designed to keep people out of poverty in old age. Just because they work so well is no reason to get irrational about numbers.

  • Gilbert Martin||

    Actually they are exactly as I characterized them.

    They explicitly impose burdens on future generations in perpetuity.

    It is physically impossible that you could ever prove otherwise.

  • Tony||

    Like many good government programs, the burdens they impose are outweighed by the benefits they confer.

    You talk about these programs as if they consist of nothing but throwing money onto a bonfire, then you refuse to consider that income has anything to do with the bottom line on a budget. This is insanity.

    Defend putting millions of old people into poverty on the merits of the policy itself. Is that so hard?

  • antiestablismentarianism||

    The reason those programs are failing is because Congress keeps "allowing" itself to borrow appropriations (money) for other purposes. Many right leaning people view these as "entitlements" similar to welfare and food stamps, but they are quite different. While they are entitlements in the basic sense of the word, we the people are actually entitled to them because it's OUR money! Americans pay into these programs separately from regular federal income taxes. If Congress could keep their grubby paws off of our money, those programs would be self-sufficient. Cutting them would be government theft and would be challenged as a class-action lawsuit in superior court.

  • Gilbert Martin||

    "Many right leaning people view these as "entitlements" similar to welfare and food stamps, but they are quite different. While they are entitlements in the basic sense of the word, we the people are actually entitled to them because it's OUR money! Americans pay into these programs separately from regular federal income taxes. If Congress could keep their grubby paws off of our money, those programs would be self-sufficient. Cutting them would be government theft and would be challenged as a class-action lawsuit in superior court."

    Incorrect.

    The programs are PONZI schemes. None of the money paid in via FICA taxes is set aside in individual accounts in the name of the people who paid them. It is paid out to someone else.

    Having individual accounts is the ONLY way it would not be theft of private property. Social security is simply a general tax and a welfare scheme that the government has tried to pretend is something other than that by calling it "social insurance". That characterization is not how it got through the Supreme Court. The government presented it as two separate activities - FICA taxes under general taxing power and a welfare program as "general welfare"

    And the courts have already ruled that no one has any standing to sue the federal government for an benefit cut or elimination simply because they paid FICA taxes. Any "class action lawsuit" would get nowhere.

  • Gilbert Martin||

    Furthermore, social security is internally redistributive in that the benefit formula has "bend points" that acts just like a steeply progressive income tax so that it gives lower income people more benefits in relation to what they've paid in FICA taxes than it gives to higher income people. And also higher income retirees get part of the benefit taken back by making up to 85% taxable if they have other income that exceeds a certain dollar threshold (that is not adjusted for inflation).

    On top of that, Medicare part B premiums are deducted from social security benefits and higher income people are forced to pay higher premiums which means they get an even smaller social security benefit.

  • Gilbert Martin||

    "Like many good government programs, the burdens they impose are outweighed by the benefits they confer."

    Nope.

    Anything done by force is a zero sum game. And government is force and nothing but force.

    Government spending amounts to nothing more than forced transfer payments that can never net to any value greater than zero.

    That's something else you will never be capable of proving otherwise.

  • Tony||

    "Anything done by force is a zero sum game. And government is force and nothing but force."

    Both untrue. If I were to remind you that libertarians say this shit and then go on to endorse a government that does nothing but shoot and cage people, would you remind me that you're actually a nutjob anarchist?

  • Gilbert Martin||

    "Both untrue"

    Like I said, you will never be the least bit capable of proving otherwise.

  • Gilbert Martin||

    "Defend putting millions of old people into poverty on the merits of the policy itself. Is that so hard?"

    The only thing that counts as "putting" anyone into poverty is explicitly stealing their private property.

    Refraining from transferring my property to someone else does not constitute "putting them" into poverty.

    Yet another thing you will never be capable of proving otherwise.

  • antiestablismentarianism||

    I'll bite. You are not transferring your property to anyone. These programs are paid into by every working American separate from income taxes. By removing these programs, the government would be "explicitly stealing their private property" as you so eloquently put it.

  • Gilbert Martin||

    Yes my property is being transferred to someone else.

    The ONLY way it would not be a transfer would be if the money I paid in was explicitly set up in an IRA type account in my name that I had legal property right to the same as any other individually owned financial account.

    That's not how social security works and it a transfer of private property to someone else.

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