-
Obamacare Implodes
May 15, 2013 | 41 comments
-
Obama’s Rising Inequality
May 8, 2013 | 101 comments
-
Downsize the Liberals
May 1, 2013 | 53 comments
-
Fight Back! Privatize the FAA!
April 24, 2013 | 65 comments
-
Fallacies and Charades
April 17, 2013 | 14 comments
The Obama Watch
The Budget Battle: How President Obama Is Trapped
He promised a “net spending cut.” It’s up to House Republicans to help him keep that promise.
The mistake that most commentators are making on the budget is the idea that a bill has to be passed to cut spending. For much of the 2012 budget, which Congress is now debating, that is not true. In many cases, the absence of legislation can cut spending. With Republicans thoroughly in control of one house of Congress, that legislative reality leaves them with great power to cut spending.
Moreover, today’s new political realities, as evidenced by the historic 2010 election, sharply constrain the budget positions President Obama and Democrats in Congress can take. Many of these Democrats, including the President, got elected on the pretense that they would control spending better than the Republicans. In a nationally televised debate in 2008, President Obama pledged to the nation that his plan for the budget would involve a “net spending cut.” The federal budget then was $2.982 trillion. President Obama’s budget last year projected spending for the current fiscal year, 2011, to be $3.882 trillion. Speaker Boehner should ask for a personal meeting with the President, to which he would bring a dictionary to go over the meaning of the word “net.”
The political reality is that President Obama and his left/liberal Democrats must be careful not to be exposed in this budget debate as the big spenders they are. That is another big advantage that the Republicans need to be aware of, and exploit.
Finally, where they can’t cut spending because Obama and the Democrats stand in the way, House Republicans should frame the debate for 2012 by passing budget cutting legislation that would be popular in the current political climate and show what Republicans would do with an even more sweeping victory in 2012.
The Ryan Budget
The last, Democrat-controlled Congress never got around to passing an actual budget. The failure of the omnibus spending bill in the lame duck session means that not even all the appropriations bills for the current fiscal year, over one-fourth of which has now passed, have even been enacted. The government is operating today under a continuing resolution, which expires in early March. This means that much of federal spending even for the current fiscal year can be cut just by not passing appropriations bills authorizing increased spending. (No, I am not saying the Republicans should not pass regular appropriations bills.)
Soon, House Budget Committee Chairman Paul Ryan will reveal his budget, the sooner the better. In fact, he should seize the moment and release the Republican House budget even before President Obama’s dilatory administration gets around to releasing theirs. Because no budget or appropriations bills were passed by the last Congress for this fiscal year, the Ryan budget can effectively be a year and a half budget.
That budget must include a sharp cut in federal spending sufficient to inspire wildly enthusiastic, grassroots, Tea Party support. The touchstone of that budget should be to reduce all federal spending items except Social Security, Medicare, Medicaid, and federal debt interest at least to their levels in 2008. That alone would save $345 billion in the very first year, by my rough calculations, based on Obama’s published budget from last year. Even better would be to take it back to the 2007 budget spending levels. That would save roughly $527 billion in year one alone. Two thousand seven was just four years ago, and America survived fine with those levels of federal spending. That would provide for a much better defense budget as well than Obama’s unilateral disarmament of America defense budget.
Such a budget strategy would inherently involve terminating all unspent funding from the abusive, intellectually indefensible, utterly failed 2009 Obama stimulus. It would also inherently involve ending all further TARP spending, though formal legislation to terminate any further TARP authority may be worthwhile as well.
Some other items should also be zeroed out in the Republican budget. That would include federal funding for National Public Radio (NPR) and public television broadcasting. There is no reason why these operations, to the extent they are worthy, can’t find private sector financing. We can’t be borrowing still more money from the Chinese, and adding still further to our national debt, to fund such unnecessary federal projects. And that should be the test for every line item. Should we borrow money from the Chinese and add still further to the national debt, to finance this?
The House should then swiftly pass that Ryan budget. That budget then becomes the governing document for all House committees, regardless of what the Senate or President Obama have to say about it. That budget does not have to pass the Senate to become effective for the House. Congressional budget resolutions do not even go to the President for his signature or veto.
House Speaker Boehner should then send that budget to President Obama and Senate Majority Leader Harry Reid, fresh from his stolen election in Nevada in my opinion, with a cover letter saying simply, “This is the House budget and we are sticking to it.”
Regardless of what President Obama or the Democrat-controlled Senate want, if the House doesn’t pass an appropriations bill spending any particular dollar on any particular program, it doesn’t get spent. No need to negotiate with Obama or Reid on any of this.
Yes, this doesn’t apply to entitlement programs like Social Security and Medicare, which are on automatic pilot. Further entitlement reforms will have to be enacted by legislation to balance the federal budget over the long term. More on that below. And, of course, it doesn’t apply to federal debt interest, which must be paid in any event. But that still leaves plenty of room to cut. In fact, if they maintain strict limits on all discretionary spending growth for long enough, providing for any essential defense increases by cutting other spending even further, I believe they could even balance the budget for a time within the 10-year budget window, though, again, permanent, long-term balance would require entitlement reforms.
This is where the political reality kicks in for Obama and the Democrats. In the current political climate, President Obama cannot rally the nation against the Republican budget because it does not spend enough! That would just tear off the fiscal conservatism mask that Obama and much of the remaining Democrats used to trick the public into electing them in the first place. (This same political dynamic applies to any old bull Republicans that may want to resist the Ryan budget internally. Ryan should recognize this and aggressively bypass any such internal Republican opposition.)
About the Author
Peter Ferrara is Director of Entitlement and Budget Policy at the Heartland Institute, General Counsel of the American Civil Rights Union, Senior Fellow at the National Center for Policy Analysis, and Senior Policy Advisor on Entitlements and Budget Policy at the National Tax Limitation Foundation. He served in the White House Office of Policy Development under President Reagan, and as Associate Deputy Attorney General of the United States under President George H.W. Bush.
Letter to the Editor View all comments (30) | Leave a comment
More Articles by Peter Ferrara
More Articles From The Obama Watch
http://spectator.org/archives/2011/01/12/the-budget-battle-how-presiden
Follow us:
ADVERTISEMENT
Current Issue
- The Great Train Robbery
- Inside the Gates of Eden
- Screwtape Talks Turkey
SPONSORED LINKS
FLASHBACK TO: 1995
-
Pope Culture
A man of faith in a godless age is hitting Americans where it hurts.
-
Why the GOP Does Not, Like, Totally Suck
Mr. and Mrs. American Spectator Reader, let P.J. O’Rourke talk sense to your kids.
-
Dames at Sea
-
In the Absence of Guns
In Britain, defending your property can get you life.
-
The Metaphysical Martini
-
Counting the Costs of Clintonism
The debacle of this president’s administration is both a cause and a symptom of the decline of American values. Unless Congress impeaches him, that decline will go on unchecked. An eminent jurist surveys the damage and assesses the chances for the recovery of our culture.
-
Chuck McHagel
It won’t take long for conservatives to scratch this presidential wannabe off their 2008 scorecard.
-
The Legacy of Old John and Mother Fresh-Roasted
-
It’s the Best Time of the Year
The American Christmas, like the songs that celebrate it, makes room for everybody under the rainbow. Is that why so many people seem to be hostile to it?
-
The Bush Crack-Up
Was the President done in by the economy, or by the politics of the economy?
Clip of the Day
ADVERTISEMENT
Mimi| 1.12.11 @ 7:31AM
Peter...smashing, up-lifting, wise article. QUICK, OUICK....somebody, puleese send this advice immediately to BOEHNER, and another to RYAN.....Fantastic ANSWER to all our woes on fiscal matters facing this NATION! Is there any way you could GO to Washington to aid the Country??? You give us so much HOPE , Peter.
msdubya| 1.12.11 @ 10:20AM
I sent this to Speaker Boehner. I hope someone in his office reads it.
Mimi| 1.12.11 @ 10:58AM
OMG..THANKS I don't have the tech to do it...(knowledge or equipment) AND NO KIDS AROUND!!
inge| 1.12.11 @ 7:37AM
It would also help to cut funding for Planned Parenthood, an abortion mill substituted in the amount of $320+ million dollars.
c. j. acworth| 1.12.11 @ 7:45AM
As a woman who came through the Great Depression and WWII, my mother raised me an optimist. Always look to the future with hope. It's up to us to make sure that for once the Stupid Party doesn't live up to it's name. Don't for one minute let them get the idea that we aren't watching every vote and keeping score!
MacDaddy| 1.12.11 @ 8:49AM
Just sayin', we need to get cracking on this...by my (admittedly rough) estimation, even if we ever get back to the point where we were under Clinton with a $236 Billion surplus, and if we were able to sustain that, it would take us more than 60 years to pay off the national debt.
Stan Redmond| 1.12.11 @ 2:55PM
There was NEVER a Clinton surplus.
Borrowing from one pocket (social security) to fill the other pocket (general fund) is not considered income to anyone but the Clinton spinmeisters.
http://www.craigsteiner.us/comments/147
blackwatch| 1.12.11 @ 10:11PM
$14,000 Billion debt divided by $250 B per year "mortgage" = 56 years of payments.
We need to do much better. Make it a half a trillion ($500B) annual payment and then we are at 28 years.
That needs to be the standard we seek. We need to pay off our nations credit card over 30 years like a mortgage.
Everyone can "get" the concept. No more credit card spending!!!
Spoonman| 1.12.11 @ 8:57AM
Peter, another outstanding column. I have contacted the Speaker and suggested that the House revert to spending at the 2007 budget level. We need others to do the same and to email or call their representatives and senators with the same message. If they get enough communications for their constituents, we may have a chance of making something happen. The $100 billion in potential cuts being tossed about is peanuts and totally inadequate given how much Ffederal expenditures have increased in the past two years. If we don't SCREAM about this no one will hear and no one will listen!
buckeyeman| 1.12.11 @ 10:54AM
So what is the likelihood that the Republican controlled House will adopt an approach anything like this??? (Hint: zero)
Mimi| 1.12.11 @ 11:06AM
Pretty darn good.. I'd say... they like to hear from citizens....How else are they gonna know what it's like out here. We are blessed to have a lot of NEW recruits... there is so much HOPE now.
victor| 1.13.11 @ 2:30AM
Mimi:
" they like to hear from citizens.."
Well then, what's the problem?
Every last one of us should call our elected representatives, their numbers are easy to find on the internet and then call them and let know when they do good and when they do bad.
Especially when they do BAD!
aware| 1.13.11 @ 6:16AM
Yeah, just like we did with TARP. They really listened that time. Don't know about you, but I would be "talking" to the exact same people this time as I did then. And I bet with the same results.
And Mr. Ferrara, like all good supply side monetarists, just absolutely refuses to see the 900 lb. gorilla sitting on his face....the Federal Reserve. The Fed has hypnotized the spenders in government with easy credit, just as it did with the spenders in housing. At the moment, the mountain of debt obscures the valley of default. Meanwhile the plundering continues as we look for cures from the very ones bringing the contagion.
richard ryan| 1.12.11 @ 11:17AM
Love this article, great place to start. But Republicans had better start sounding off about the entitlement tidal wave. If the 14 trillion national debt sounds scary, how about unfunded liablities for medicare and social security north of 75 TRILLION!! Ryan is the only one who has a reasonable solution for this. When republicans finally get real legislative power, it will be the entitlement problem that will cause the most backlash so they better start articulating the problem to the people NOW.
Honesty in Dollars| 1.12.11 @ 12:44PM
Another great column by Mr. Ferrara!
Alas, me thinks he does dig too deep into too many details, an activity which necessarily produces the MEGO response in most people---my eyes glaze over.
I remember years ago when first getting up to speed wrt world finance, reading the Wall Street Journal, and trying to make sense of the foreign currencies, in particular the Yen.
When I finally realized a Yen was about the same as a PENNY, it started to make more sense.
Also, I’m old enough to recall when a Mickey Mantle type got a salary of $100,000 a year, and it was a big deal. Of course, as time passed, a contract for $1,000,000 came along, and we’re now at the point where a top star in sports makes that much for, say, only four basketball games in the NBA.
My point?
Not only is Federal Reserve inflationary actions a problem, but even if people adapt by taking it into account, we reach the point where we have to talk in terms of a BILLION, and now a TRILLION, and soon enough a thousand TRILLIONS of dollars.
This FACT, permeating today’s news about government budgets, etc, means that the shock value of using a word like TRILLION is mostly muted. Most people just don’t, PERSONALLY, get it, that THEY are being screwed.
Someone should start using a simple computer program to simplify EVERY one of those huge dollar numbers having to do with government spending and debt, by dividing them by the population of America.
So, take the acknowledged HARD truth, that this year the federal deficit went up by a TRILLION dollars---$1,000,000,000,000 and divide by 300,000,000people, and the sad result is that the government spent $3,000 per person MORE than it received in taxes!
Essentially, then, it’s as if every DAY, the feds took a ten dollar bill from YOU.
Or, put it in terms of work---since the work force is only around 100,000,000 that means these---YOU!--- people worked to earn money for themselves, but the government, in plain sight, TOOK $10,000 worth of their production---without their approval!
Maybe the best number to focus on, a la Milton Friedman’s insight, is the total spending by the federal government---close to 4 TRILLION, or $4,000,000,000,000.
That’s $40,000 for EACH worker, per year!
If all people who are working hard to get by and even save money knew this, instead of simply regularly reading about a TRILLION dollars here and a TRILLION dollars there, they might PERSONALLY understand how they are being ripped off, and the righteous anger of the Tea Party that helped change congress in 2010 would double, and make reform impossible to stop.
Just saying.
cnv| 1.12.11 @ 1:10PM
It's not going to happen. You can tell because the republicans are already maneuvering to protect their favorite pork.
MikeD| 1.12.11 @ 2:09PM
This article should be sent to EVERY member of congress (When it is deserved, I'll start capitalizing congress!) to be used as a blueprint of the first 6 months in session. Do not let the events of last Saturday get you bogged down in a defensive posture. IGNORE THE IDIOTS ON THE LEFT!
You have been given your marching orders by the voters. Even though the article is great, I still would like to point out two things. (As I ALWAYS DO!)
1. I will never believe that either Bush or Clinton ever really ran a surplus. They bragged that, if the trends continued, the result would be a surplus, but I challenge any of the really smart people reading this to prove that we have run any kind of a budget surplus since 1993.
2. We need to get the message out to the congress that WE ARE BROKE! We have no money for anything! We need to cut the budget a minimum of 10% across the board for each of the next five years. Yes, people will scream. We'll cry and moan. The dems will swear granny is eating dogfood; although they have disqualified themselves from ANY of those specious arguments since they brought berwick the killer on board to not just force dogfood on granny, but to kill her.
(That is actually not a stretch for dems, they already kill babies, why not the old too? It's just what dems do. I defy ANY democrat voter to argue this because any vote for barry was a vote for late term abortion. He favors it; he tried to make saving a baby that survived it a crime; and all toy dems knew it when you voted for him. )
'Nuff said. Now get on with it; we're out of time as well as money.
Now, get out there and cut the budget!
Dale Emde| 1.12.11 @ 2:14PM
Why doesn't Obama ask the Fed Reserve to suspend interest payments for 5 or so years.
Then we could get things straighened out and realize who needs the Fed?
wodiej| 1.12.11 @ 3:00PM
I look forward to seeing what they do. I was heartened by the reading of the Constitution. Let's roll.
Bob White | 1.12.11 @ 10:12PM
We could do better than roll back to 2007. Let's end the drug war and save $40 billion/year. We've spent far more on that losing war than on Iraq & Afghanistan combined. Imagine sending almost 50% fewer people to prison every year. That'd save a lot of cabbage.
earlofroberts| 1.13.11 @ 12:35PM
Problem is that Obama will not phrase it as "does not spend enough!". It will be described as taking food from widows and orphans.
hugh BNYN| 1.14.11 @ 2:21AM
---The very phrasing of this article, in keeping
with the rest of our foundation-fronting media
---is decades stale/
Open, audit, and ----end the FED and our phoney,
debt serving fiat currency.
Prosecute the responsible leaders to the full, unflinching and absolute extent of the law.
Likewise the Freemasonic capstone 'charitable'
foundations and NGO's with special attention
to their collusions and involvements with the Bolshevik coup d'etat, Stalin, Hitler, the Great Depression, WW2, Mao Tse Tung, and most chillingly, the current illegitimate regime running
RED China ---as well as their founding, funding, promotion and implementation of VAST eugenocidal programs, operations and policies
here and around the world.
No exaggeration to say a HUAC meets Nuremberg
tribunal is surely, truly called for...
BTW----London should move along similar lines w/o delay!
"Understand, what we're talking about here are inbred,
inter-generational, globalist, genocidal psychopaths..."
-Alan Watt
(RED Ice interview on Youtube)
AMEN
dffd | 1.14.11 @ 6:33AM
I look forward to seeing what they do. I was heartened by the reading of the Constitution. Let's roll
Not Perfect | 1.16.11 @ 4:47PM
You want to balance this BUDGET! Go back to the day of Woodrow Wilson and defund all those Departments he started. Department of Energy, EPA, League of Nations aka United Nations! You can cut defense without hurting our military and close bases that don't need us there! Bring our boys home but, TAKE CARE OF OUR VETS! Does that sound harsh? TOO BAD We will pay more later if we don't get a hold of this MONSTER. Beware of WOLVES in SHEEP'S clothing.
jacky | 3.20.11 @ 6:01AM
I was in a McDonalds a while ago
The Clintidote| 4.26.11 @ 9:23PM
I happened to have left this article tab open for many weeks. In hindsight, it's hilarious.
The problem, of course, is that Weepy Boehner the Boner has no balls.
Adidas | 8.11.11 @ 5:44AM
is good
العاب | 4.10.12 @ 12:55PM
Well then, what's the problem