Volume XIX No. 9
What a difference two months makes. In December, House and Senate Budget Committee Chairs Paul Ryan (R-WI) and Patty Murray (D-WA) hammered out a deal that set the spending levels for fiscal years 2014 and 2015. At least we thought they did. Now it seems that when the President’s budget comes out on Tuesday, there will be an extra $56 billion on top of the $1.01 trillion that was agreed to 64 days ago.
The extra cash will be evenly split between defense and non-defense spending. And of course we will hear about how great this extra money will be – all the wonderful infrastructure and weapon systems that can be purchased with it. And we will hear about how there are some spending offsets in form of new revenue and spending cuts a few years or decades from now. C’mon. This isn’t our first budget rodeo. Taxpayers didn’t just fall off the turnip truck.
Just as any family knows, budgets are about priorities. Once the top line number is set – like it was in December – you set about figuring what is important enough to get some cash: Groceries, electricity – yes; Xbox and new home entertainment system – not this year. Dangling a possible $56 billion extra is like saying you can buy a new car on your credit card. It’s an attempt to get people to bite – “for just $56 billion more you can have [blank]!”
Sure the deficit isn’t greater than a trillion dollars any more. But it’s still more than half a trillion dollars. And the cumulative debt – well that’s more than 17 trillion dollars. It’s not like the nation is in fat city and happy days are here again, the President and lawmakers still need to be responsible with the federal pocketbook.
There will be a lot of attractive items in the bonus $56 billion. But remember they weren’t attractive enough to get into the President’s base budget. And there can be responsible offsets, but if this is about extending sequestration another couple years to get cash today, no thanks. We’ve seen enough of this spend some more now and pay for it with sequestration in a decade gimmick. House Republicans floated it as a way to reverse cuts to military pensions cost of living adjustments, and the Murray-Ryan deal promises sequester in Medicare in 2023 (never happening) to bump up spending in 2014 and 2015. We came up with more than $100 billion in real one year savings in our report Real Savings, Real Deficit Reduction: Relieving Budget Caps with Common Sense Savings in Fiscal Year 2014. That was the blockbuster follow up to Super Cuts for the Super Committee (2011), Sliding Past Sequestration (2012), and Common Sense Proposal to Rappel the Fiscal Cliff (2012).
And that brings us to that dread word: sequestration. Here’s the thing. The President and Congress don’t have to fear sequestration. It doesn’t have to ever occur. The mindless across-the-board cuts of the sequester only come into play if the President and Congress exceed the budget numbers that they already agreed to!
We can’t afford gimmicks. We can’t afford everything at the budget buffet. It’s time for the President and Congress to keep the promises they made.
Late again this year, the budget will come out in two stages: the initial package of materials on March 4th and much of the backup documentation a week later. So while we will be pouring through the thousands of pages on Tuesday, we may not know the real details for a while. You can follow our work on the budget here.