Will Congress really cut the budget? Top 3 acid tests.
We will soon learn whether all the political talk about controlling the federal deficit is serious or just noise. The next several months will provide an acid test for those pols who are bloviating about out-of control government. My advice: Pay no attention whatever to what they say, just watch how they vote.
Here are three issues to watch:
Pentagon Spending. Defense Secretary Robert Gates, who unlike most cabinet secretaries seems serious about reducing waste in his own department, would shift $100 billion in overhead over the next five years (from a cumulative budget of more than $3 trillion). Be clear, even Gates is not proposing to cut overall Pentagon spending. But he recognizes that in what is likely to become an era of constrained federal spending, the Defense Department needs to use its funds more wisely. So he’d make the military a bit less top heavy, fire some contractors, and eliminate a few useless weapons systems. His most controversial proposal: Eliminate the Joint Forces Command in Norfolk, Va., which despite its grand name commands no forces at all.
Gates’ proposal, which any business person would recognize as eminently sensible, has so far succeeded only in bringing Virginia’s Democrats and Republicans together—to howl in outrage. They will try to kill it at the first opportunity--maybe this year, maybe in 2011. Even self-proclaimed fiscal conservatives such as Representative Eric Cantor (R-VA) are lining up to bury the idea.
Before the Defense Secretary rolled out his scheme, Cantor wrote this:
“The time has come for Congress to finally show political courage. American families have been forced to face tough financial realities and make difficult but necessary decisions. Why should their government act any differently?”
Hint: “Because it preserves political pork for my home state” is not a good answer.
Medicare: The Patient Protection and Affordable Care Act contains plenty of new health spending. But it also includes a provision that holds the promise of slowing Medicare growth. According to the new law, if Medicare exceeds certain spending targets, an independent board will recommend ways to reduce future costs. This board hardly has a free hand. It is barred from proposing changes that would ration care, raise taxes, limit eligibility or benefits, or increase cost-sharing. In other words, about all it can propose is cutting payments to providers. Still, it is something.
Sadly, even these small steps are too much for top Senate Republicans who introduced the “Health Care Bureaucrats Elimination Act” that would abolish the Board. Once again, self-proclaimed fiscal conservatives such as John Cornyn (R-TX), Orrin Hatch (R-UT), and even Tom Coburn (R-OK) are out to kill a modest effort to control government spending. Their bill may never get a vote. But it should. I’d love to see the roll call.
The Bush tax cuts: TaxVox has had plenty to say about this one already. But the argument we’ll hear this fall is pretty simple: Do we want to permanently extend all the Bush tax cuts and increase the deficit by $3.7 trillion over the next decade, do we want to do so for all but the highest earners and increase the deficit by merely $3 trillion, or do we want to extend some or all of the Bush tax cuts for just a year or two and raise the deficit by a few hundred billion dollars? Hardly anyone on Capitol Hill would let them expire.
Watch these votes, and learn who is really a fiscal conservative and who is not.
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