This Budget Cutting Thing is Hard
To borrow a phrase: budgeting is the science of muddling through (with an emphasis on the "muddling" far more than the "science."
James Joyner has already noted an AP piece (at WaPo) on the CBO’s scoring of the budget deal cut last week. The piece notes that not only is the deficit reduction agreed to far smaller than advertised ($352 million instead of $38 billion) but, in fact, if one includes off-budget military spending, we are actually $3.3 billion further in the red ink.
All of this underscores a view that I have had since the start of the current Congress: that all of this deficit reduction stuff is harder than it looks. More specifically, I always found the Tea Party attitude (that cuts are easy and that all it takes is the will to cut) to be a bemusing combination of naiveté and magical thinking.
It is also why I always considered the promises to cut $100 billion from the get-go to be a fantasy. As Peter Suderman noted earlier in the week:
The numbers just keep getting smaller, don’t they? Republicans started the year demanding $100 billion in cuts. But it quickly turned out that when they said $100 billion, they were just talking hypothetically. Instead, they meant $100 billion on an annualized basis. The next we heard, Republicans were aiming to trim $61 billion. And not one penny less! Eventually, they agreed to a deal that they claimed cut $38 billion. But of that $38 billion, it turns out, the real cuts only add up to about $14 billion. Any bets on how many days before the cuts disappear entirely?
As Suderman notes today in response to the AP story noted above: “I didn’t intend the question to be taken literally.” And yet…
All of this sparks a couple of thoughts:
1. The Budget Process is Complex. The discussion of the budget in the press (and by many politicians) seem predicated on the idea that all you have to do is stop going to the ATM and no more money will be spent (we are about to see a flood of this when the debt ceiling “debate” is unleashed). It is nowhere near that simple. This is a machine with a lot of moving parts. Not only is there the whole authorization/appropriations process, but also the fact that it is impossible know with precision exact outlays (for example, there is no way to know exactly how many food stamp recipients there will be in a given year, nor do we know how many cruise missiles we will launch). Additionally, all spending is not contained in a single fiscal year, but often is spread out over several. As such, the treatment of a cuts as though they are taking place in a static circumstance ignores the actual dynamic nature of governing.
2. We Have to Reassess our Military Commitments. From the above-linked piece at WaPo:
When war funding is factored in the legislation would actually increase total federal outlays by $3.3 billion relative to current levels.
Yes, the single most significant long-term issue for the federal budget is that of health care costs. But, let’s not ignore the fact that two near-decade-long wars and now an additional military action is part of the problem. Further, we have to consider what other temptations will present themselves to future presidents in terms of military action. That is to say: even if Afghanistan, Iraq, and Libya all end soon we have to consider what we are going to do about future military commitments (not just wars, but military bases and so forth). This is about assessing our global role, as these things cost money. (And yet the cries of “gutting” the military have already started, even before a cut of significance is made. See John Guardiano at the FrumForum). This all reminds me of Doug Mataconis’ post: Operation Odyssey Dawn Price Tag Hits $600,000,000 (that was for the first week).
At a minimum, we cannot pretend that a substantial part of our fiscal problems at the moment isn’t our general willingness to expend massive amounts of money on military operations.
3. Real Change is Going to Take Time. One of the things that keeps coming to mind for me is that real change is going to take time (not to mention require compromise—which means both cuts and increased revenues). Further, getting back to the aforementioned magical thinking, some of these changes are going to have to be phased in over time. A simple example: it might actually be possible to phase out funding for CPB to allow the organization to adjust to a future without federal funds. This might be politically viable. However, just saying “to the budget guillotine right now!” is going to create political backlash. Plus, I am not sure that it is fair to make radical and immediate changes that effect jobs and lives if such drama isn’t actually in service of an immediate need.
Bottom line here: it has taken us (contra the claims of some) decades to get to the situation we currently find ourselves in. Further, we are actually not yet in crisis (that is something projected for the future). So: if the problem took a long time to construct and if the real impact of said problem is in the future, perhaps a more measured approach is warranted.
While there are difficulties, public disgust is an important weapon. If these clowns think they are sailing toward reelection they won’t feel quite the fire against their feet.
.. on a practical level we should ask for CBO data before final vote.
Yes…governing hard…demagoguing easy. The baggers are fiscal frauds. They are unprepared and uninterested in the hard work of running a government for a complex and diverse population. They want to return to the Eisenhower years only without all the regulations, taxes, and people who don’t look like them or speak their language or enjoy their sexual preferences (or lack thereof). And by gum they’ll use second amendment remedies to change the parts of the constitution they don’t like.
Comical really. But sad too.
People feel overwhelmed by detail, so they look for simpler ways to approach the problem: Bomb ’em all back to the stone age, or just say no, or cut waste fraud and abuse.
They think they should know what to do, and they are unwilling to defer to people who do understand because they assume (often correctly) that the smart guys are screwing them.
It’s a bit like walking into CERN (Home of the Hadron Collider) and announcing that we’re just going to have two particles: red and blue. And that’s that, problem solved, now everyone go home.
This is the problem that comes from elites misbehaving, and from media elites deliberately sewing the seeds of mistrust in order to get ratings. The simple and unnerving truth is that we have no alternative to trusting a certain number of people in life and in government.
I don’t know, michael, how many actual (and not phony) billions could we get out of agricultural subsidies? energy subsidies?
It’s not that it’s hard. It’s that the misdirection is so rampant.
That sounded like a bit of an aside, but it really seems like it should be a central issue. Do these people who are demanding such huge cuts have any idea what the effect would be? I get the feeling that it’s just a bunch of numbers to them satisfying the strange anti-government fetish du jour. A sensible approach (to me) would be to call for 2% cuts to DOD, for example, every year for the next ten years.
JP:
It’s not that hard to you, because you’re smart and engaged and take the time to become informed. What percentage of voters do you think are in your percentage? 5%? Maybe.
Unfortunately to the 95% people like you, and me, and Steven Taylor, all sort of blend together as part of the problem. You have axes to grind, so do I, and if we can sort of imagine an elite that does the actual governing, there’s a substrata of elites — a sub-elite — who spend way more time and energy on this stuff than normal people do.
Below that layer there are the angrily engaged. People who think all we need to do is “X.” Like Jay T who thinks closing the Department of Education is a serious start on balancing the budget. They’re ignorant but engaged, highly partisan, eternally angry. They exist on the Right and the Left.
And then there are the bulk of the American people who ar just hoping someone’s dealing with this stuff because they’re busy getting the kids to school and themselves off to work.
Exactly, michael. I want smart, hard-working policy wonks to get in there and figure out the costs and benefits of various plans. I don’t want a bunch of lazy, dumb, partisans and/or ideologues running things. Unfortunately, those types get elected way too often to Congress, and they’ve obviously run rampant in the media. I always hope that the few nuts drown out the majority of quiet, serious people, but it seems to be getting worse.
It’s Echo-effect Day.
Also, Write Like a Minimalist Pirate Day
Sadly, the most rational response.
More means-testing would be a way to cut without, by definition, harm.
Costs and benefits to whom? Part of the problem is that value is not intrinsic.
BTW, rather than incremental defense cuts, we should just withdraw from the 3 wars. Quick, easy, huge savings.
Another rational move, in face of mounting food stamp costs, and uncertainty about who is using them, would be to further limit the items to which food stamps may apply.
Right now you can buy soft drinks.
Heck, you can buy energy drinks.
I understand people will have different ideas about taxes and spending, but right now, it seems like no one is even asking these questions. One side is trying to make all the cuts it can get politically (because bigger cuts are always better?), and one side is going along with the premise and only quietly protesting the most egregious of the cuts.
I would generally be for that, too, but both can be done. My incremental approach was meant to be a more rational suggestion than the “Just cut it all!!! yaarrghh” folks. (Of course, DOD is a bad example, since the people I’m referring to only want to slash domestic spending.) Slashing budgets under a TP Congress and restoring it under a Democratic Congress is no way to run things.
Norm, you are beginning to sound a bit like Obama’s bible clinging, gun toting, antipathy diatribe he regurgitated for his uppity friends. He slimmed us all then and hasn’t stopped.
Oh and I see that you support the 2nd Amendment. That makes two of us.
What is it about we are broke that some folks don’t understand? Out here in the 57 states we’ve got it figured out.
This is a good example of sloganeering. We’re obviously not “broke”, but Republicans will say that over and over to move the debate and polling their way.
Ignoring the “57 states” idiocy….
Here’s an example… An idiot R from Georgia is on MSNBC. He said he’s going to vote to cut Planned Parenthood and other things. The interviewer (to her credit!) asked him if he’s concerned about making too many cuts and undermining the economic recovery. His response was that the economy is shaky because of the debt. Ugh….
I wasn’t even talking about tax cuts vs. spending. I meant things more like, how much of an additional teacher in Detroit is an additional artificial knee for a Los Angeles senior worth? The idea that there’s one right answer to a question like that is ridiculous, but anyone claiming that budgetting ought to be a simple matter of cost-benfit analysis is essentially making that case.
Stormy, I understand. You’re reading too much into what I wrote. In the current context, I want to know that the people who are proposing massive changes to budgets and agencies have given thought to and researched what the benefits are to cutting those budgets; and what the costs will be if those cuts are implemented. It all seems too ideologically driven at this point.
rock;
tell me what I said that isn’t correct?
If this is true, then isn’t it logical to conclude that pledges to reduce the debt/deficit by trillions over 10 years (or whatever) is equivalent to a crack cocaine induced hallucination?
BTW I’m not disagreeing I think much of this “We are going to reduce the deficit (debt, whatever) by $x in n years!” is typically bullshit rhetoric designed to placate the voter long enough to get past the next election cycle.
Rock:
Let me help you…
“…They want to return to the Eisenhower years…” Certainly one of the party slogans is “Take America Back”. Back to when? To where? Party leaders like Glen Beck wax nostagic for “a happier time”.
“…only without all the regulations…” Isn’t this the heart of the small government argument?
“…taxes…” Ditto. The top tax bracket under Eisenhower was something like 90%. Today it’s near record lows at 35%, with top earners paying an effective rate of somewhere in the mid-teens. Yet that is nowhere near low enough.
“…people who don’t look like them…” See Birther in the dictionary. Also refer to Arizona legislation presently held up in courts.
“…speak their language…” The right wingers love them some English Only legislation.
“…or enjoy their sexual preferences (or lack thereof)…” See Santorum etc. Right wingers are nothing if not homophobes. Pawlenty wants to reinstate DADT. They are losing their minds over not defending the DOMA.
http://blogs.abcnews.com/politicalpunch/2011/04/throw-grandma-from-the-train.html (teaser: President Obama, last year: “We’re not going to be able to do anything about any of these entitlements if what we do is characterize whatever proposals are put out there as, ‘Well, you know, that’s — the other party’s being irresponsible. The other party is trying to hurt our senior citizens. That the other party is doing X, Y, Z.”).
Good God, for a Great Orator, the guys words have absolutely no shelf life.
Rock,
“What is it about we are broke that some folks don’t understand?”
The part where one party is saying that they cannot accept any methods of increasing revenue. It’s like when a family is broke, and yet the first thing that ruled out is one parent taking a second job in favor of keeping the heat turned off in mid-winter.
I’m very sorry, Mr. Taylor. You have committed an egregious error here. It has been decided that one must approach this issue by running around in panicked circles, shouting that the sky is falling. Hysteria and Fear are the only ways to demonstrate that you are Serious and Courageous.
Max…
Let me help you a little here. When Obama said: “…Well, you know, that’s — the other party’s being irresponsible. The other party is trying to hurt our senior citizens…” he was refering to rhetoric. He was talking about charachterizing something as something it is not. You know, like making up Death Panels and accusations of double dipping, and the such.
But the so-called republicans have gone beyond that. They are now actually proposing to abolish Medicare. This is not hyperbole, or exageration. It is not charachterizing something as something it is not. It is proposed republican legislation. It is cold hard fact. If there are NOT guaranteed benefits then it is NOT Medicare. Period. If the vouchers are specifically designed NOT to keep pace with health care inflation, then it is NOT a safety net. Period.
Sorry, that is hyperbole and exaggeration.
Paul Ryan has proposed fundamental changes to Medicare. But the proposal does not abolish Medicare any more than ObamaCare’s creation of the IPAB Medicare price-fixing board abolished Medicare.
And, again, Medicare as it exists today is unsustainable. President Obama says so. The Medicare Trustees say so. The CBO says so. There is no way to keep Medicare without actually making fundamental changes to it. We can argue about what those changes should be (means testing, price fixing, giving money to the states and having them decide, etc.), but calling any change at all to Medicare “abolishing the system” is what President Obama warned against last year.
No max…It does abolish Medicare. Calling a voucher program Medicare doesn’t make it Medicare. It’s like deciding to call an orange an apple. The benefits are not gauranteed, the cost is shifted, and the level of support is cut radically. It’s a fundamental change. It forces seniors to deal with private companies when their needs are the greatest and their resources and faculties are at their weakest. What Ryan is calling Medicare is not recognizable as Medicare. You need to be deep in the Koop-aid to think so. It’s like taking a bicycle, removing a wheel, and instead of calling it a unicycle still calling it a bicycle.
Hear hear. When I think about all the crap my wife and I have gone through over the years with insurance companies – I mean we are two college educated professionals with resources, and it is still a battle, and not always a winning one. And I am talking about a battle just to get the benefits we are paying for and to be billed correctly.
Could my mother do that? Nope. She gets tired easily, she gets confused, and her hearing is bad.
Yea, let’s give senior citizens a voucher and leave them to the tender mercies of the insurance companies.
I mean is there anyone here who has NOT been screwed, or had an attempted screwing by an insurance company?