This article appeared in the February issue of The American Spectator. To subscribe, please click here.
“Can we, who man the ship of state, deny it is somewhat out of control?”
Ronald Reagan asked this question less than two minutes into his first address to Congress in 1981, excoriating a government willing to mortgage the future of its citizenry via a national debt of $1 trillion. Reagan invited the American people to visualize this “incomprehensible” sum not as a string of numbers but as the cold, hard cash it actually was. “If you had a stack of thousand-dollar bills in your hand only 4 inches high, you’d be a millionaire,” he said. “A trillion dollars would be a stack of thousand-dollar bills 67 miles high.”
The Congress Reagan confronted with these words was a much different monster from the one before us today. During his first term, Republicans held tenuous control over the Senate, but Democrats controlled the House by nearly 100 seats. It took sheer will and political guile for Reagan to pursue fiscal conservatism against those odds. Even then it wasn’t a perfect revolution. The budget was still bloated and missteps were made, but the ultimate goal remained clear and the rhetoric was pure if somewhat tainted in practice. Reagan changed the paradigm of politics in America with a seismic boom that was still reverberating when Bill Clinton, desperately seeking the “third way,” declared the era of Big Government over.
But has the Republican Party lived up to this legacy? It takes a bold partisan to make such a claim. Consider: In November, the Republican majority in Congress passed legislation on a near-party line vote raising the government’s debt limit to $8.18 trillion, a figure close to 70 percent the size of the entire U.S. economy — at the urging of a Republican president regarded as the ideological descendant of Reagan. Shortly thereafter, the White House issued a statement “commending” Congress for this action. There was no mention in it of a now 500-mile-high stack of thousand-dollar bills. If this Captain believes the ship of state was out of control, he wasn’t letting on.
“In politics you get to be one of two things: A pleasant surprise or a bitter disappointment,” former House Majority Leader Dick Armey said. “This Congress is on the brink of becoming a bitter disappointment.”
IN SEVERAL POST-ELECTION INTERVIEWS, conservative congressmen, senators, and political operatives — forming what Howard Dean might call the Republican wing of the Republican Party — were surprisingly candid about the failures of the last four years. “The party has a problem,” Indiana Congressman Mike Pence said. “We have self-styled conservatives endorsing Big Government Republicanism with a straight face. We should already know where that road goes. It’s the road to serfdom.”
The mantra of these true believers, newly invigorated by what they see as a red state mandate for a conservative agenda is, “It will be different this time.” Conservative Republicans are promising a series of bold reforms both in policy and procedure — whether the president is on board or not.
Nevertheless, conservative mandate or not, it is undeniably the case that a large segment of the Republican caucus has not been voting in favor of fiscal discipline. It is an open question whether well-intentioned reformers and conservative stalwarts will change their votes in the aftermath of an election that saw them rewarded for their recent behavior by voters, not chastened.
Rep. Pence pleaded mitigating circumstances, and urged fiscal conservatives to join the battle rather than lose heart. “Make no mistake, for conservatives the disappointments of the last four years were driven largely by the desire of many members, even strong conservatives, to support the president in his re-election effort,” Pence explained. “After September 11 there was a sense of immediacy and tragedy that took over and created a lack of focus. Now that ensuring the president’s re-election is no longer a factor, I foresee a return to a more healthy equilibrium between branches of government along the lines of what was envisioned by the Founding Fathers.”
Criticism of Republicans’ fiscal laxity over the last four years has been muted within the party. Both the September 11 attacks and the resulting War on Terror have been frequently invoked in place of an honest debate about the state of the budget. While national security concerns have certainly played a role in the growth of the deficit, it is inaccurate to attribute all of that growth to the war. Even bills dealing directly with Iraq or terrorism have been larded with pork. Bush’s funding for national defense mirrors Reagan’s, with outlays increasing around 20 percent. But Veronique de Rugy noted for a Cato Institute report, “Whereas Reagan was able to reduce non-defense discretionary outlays by 14 percent, Bush will have overseen a rise of 18 percent — a whopping 32 percent difference between the two men.”
There is a historical precedent for cutting non-defense spending when the nation is at war that the Republicans could honor. During World War II and the Korean War, for example, discretionary spending was cut by 22 and 25 percent, respectively.
“We’re at a unique moment in the history of big government,” Pence said. “The national media turned this election into a referendum on conservative principles. If Bush had lost they would have blamed conservatives for dragging him down. Now we have a president re-elected by a strong majority, and Republican control of both the House and Senate. It’s a perfect storm. Who knows when another one will come along again? The time to act is now.”
THE RESPECTABLE DETERMINATION and moral bearing of some House Republicans notwithstanding, rank-and-file fiscal conservatives have reasonable cause for doubt. This was an administration, after all, that began with a promising tax cut, but quickly backslided, with the full complicity of many congressional Republicans, into a smorgasbord of government giveaways including increases in perpetually useless farm subsidies; the largest increase in federal education spending — 52 percent — in more than a quarter century, written by Ted Kennedy, no less; and the prescription drug benefit, the first new entitlement in 40 years. Discretionary spending under Bush has also been significantly higher than under Clinton.
Outspending liberals has been the order of the day for the Bush administration, and, yet, if the recent campaign has shown anything, liberals remain unimpressed and unsated. That the Democrats spewed vitriol at Bush for not spending more on their favorite programs, combined with John Kerry’s promises to add at least a trillion dollars to the federal debt if elected, shows the Republican Party, like the Soviet Union in its arms race with the U.S., cannot win a spending war with Democrats.
“The general approach for Republicans for several years now has been to talk about cutting spending at every opportunity while consistently voting in favor of spending increases,” said Stephen Slivinski, director of budget studies at the Cato Institute. “If they really want to rein in spending now, they can do it. They have better margins and a strong showing in the recent election. There are no more excuses.”
“This is a fight for the soul of the Republican Party,” Wisconsin Congressman Paul Ryan said. “The moral authority of fiscal conservatism is only valid if we practice what we preach.” Ryan looks like a conservative Mr. Smith going to Washington. Outraged by what he sees happening in D.C., Ryan makes little attempt in conversation to mask his distaste for the whole scene. With little prompting, Ryan recounts with a sort of jilted awe how many of his own colleagues pressured him to vote for the $300 billion-plus omnibus spending bill last November. “This 3,000 page monster lands on my desk about six hours before the vote,” Ryan said. “There wasn’t time but to leaf through it. And what little bit I actually had a chance to read, I sure didn’t like.” He voted against it. It passed anyway, 344 to 51.
TRADITIONALLY, SUPPLY-SIDERS have been reluctant to cede too much ground to “green-eyeshade” Republicanism, which they believe focuses too much on cutting deficits and not enough on clearing the boards to let the inherent dynamism of the American economy play itself out. Deficit worries are also often accompanied by calls for higher taxes rather than lower spending. Supply-siders cite the trade and budget deficits under Reagan, pointing out that the sky not fall in the 1980s and massive growth occurred.
Still, the most public faces of the supply-side movement accept some sort of deficit reduction plan. In his latest otherwise laudatory book, Bullish on Bush, the Club for Growth’s Stephen Moore calls the current budget deficits “inexcusable,” and jabs sharply that Republicans “no longer have a credible anti-big government agenda.” Moore also quotes the libertarian Nobel Prize-winning economist Milton Friedman declaring the budget deficit “the single greatest deterrent to faster economic growth in the United States today.”
“We have a budget process that works as well as a pub that opens its doors to a pack of fraternity brothers and tells them the drinks are on the house,” Moore writes.
Most conservatives see the current spending outrages as a problem of collusion between moderate Republicans and liberal Democrats. Such dereliction of duty by wide swaths of the Republican Party has convinced Pence, Ryan, and others that the conservative mandate of election 2004 should apply to reforming the system broadly, not just to quibbling over one bill or another. Whether talking about tax reform, budget reform, or Social Security reform, the central theme amongst them is “fundamental change.”
“When it comes to spending, it’s not bad people,” Pence said. “It’s bad process. If anyone believes we can restrain federal spending without fundamentally altering procedure, well, frankly, that is just not going to happen.”
It is an article of faith among House conservatives that entitlements must be reformed in order to save them and that the best method of combating out-of-control federal spending is first to change how the government works on the budget. Rep. Ryan has authored, along with fellow conservative Texas Rep. Jeb Hensarling, the Budget Fraud Elimination Act, which seeks to overturn much of the Budget Act of 1974, a bill passed by a Democratic majority and signed by a hamstrung Richard Nixon, grasping at liberal straws in the final month before his resignation. The act ushered in the era of massive, pork-filled omnibus spending bills, even larger deficit spending, and general unaccountability.
The federal budget today is passed as a resolution, a mere set of guidelines for spending that can be easily ignored. Ryan’s bill would give the federal budget the force of law, and any “budget busting” requests would require approval by a two-thirds majority. It would also close the grossly misused “emergency spending” loophole and send any savings from spending cuts back to the U.S. Treasury instead of back to the Appropriations Committee, where it currently goes to be re-spent.
“Right now you can find the most egregious boondoggle in a bill and eliminate it, but you can’t save that money,” Ryan said. “It goes back into the pork pot to be spent somewhere else. Nothing is accrued to savings. The money is spent at all costs.”
This is not, however, the first time congressional budget restraint measures have been employed. The Gramm-Rudman bill, for example, was enacted in 1985 to reduce the $200 billion budget deficit. (Ironically, President Bush is now promising to cut the record 2004 deficit of $417 billion in half by the time he leaves office in 2008 — in other words, cut it down to roughly 1985 crisis levels. The U.S. budget deficit for last November alone was almost $58 billon.) Gramm-Rudman required automatic spending cuts if Congress exceeded spending caps. Accordingly, the deficit fell from 6 to 3 percent of GDP, government spending dropped from an annual growth rate of 8.7 percent to 3.2 percent, and entitlement spending slowed to a rate of 5 percent. As further proof of its effectiveness, unions, tax-and-spend liberals, and all the other usual suspects were furious.
The good news was that by 1990, when the law was repealed, the deficit had been cut by 40 percent. The bad news was that Congress had decided they couldn’t live by such rules, a fact that does not bode particularly well for the current crop of reformers.
Fiscal conservatives disappointed with the results of the last four years should know that time hasn’t been entirely wasted, Ryan said. “This isn’t a one-year or a two-year fight,” he noted. “We’ve been on the move for a while. You have to lay groundwork for any transformational legislation.” Losing a battle, he said, is sometimes necessary to advance an issue. Ryan and his supporters brought the Budget Fraud Elimination Act forward last summer and lost. They knew they were going to lose, but they wanted to get politicians on the record against fiscal common sense before the election.
“We brought forward the most comprehensive version of budget reform I’ve ever seen, broke it into 11 distinct policies, and made members vote on each section,” Ryan said. “Our suggestions might sound like common sense to people outside of D.C., but there are representatives who consistently vote against this stuff. It’s stunning.”
DICK ARMEY, WHO FOUGHT similar battles in those same trenches, is skeptical about Republicans betting so much on procedural reform. “Policy reform is a lot easier than process reform,” he said. “Policy is about real people in the real world, and it’s much easier to explain to constituents. Congress is an unreality, a world carefully constructed to protect the interests of its members. Getting a majority of members to go along with rule changes that will make their life harder will be tough, especially since it will mean defying the appropriators to some degree. They’ve got idealism on one side, and the appropriators have got dollar bills on the other. That’s a tough fight.”
Armey hopes battles for fundamental Social Security and tax reform, which suddenly appear politically winnable, are taken up first. Linda Killian, author of The Freshmen: What Happened to the Republican Revolution?, a fascinating chronicle of the 1994 Republican House takeover, considers the idea of a new Republican revolution overblown.
“I don’t see the same sort of revolutionary fervor in the Republican Party about ending deficits as I did in 1994,” she said. “Back then it was as if conservatives were possessed. They were on a mission to balance the budget and reduce the size of government. They’d go to war with Republican leadership just as soon as anyone else if the leadership wasn’t acting conservative enough. They were so serious they made Bill Clinton serious about it. So far today’s Republicans have not been willing to press Bush in the same way.”
Killian said that even the 1994 “revolution” didn’t translate into long-term fiscal conservative votes.
“Even the ’94 guys who are still around have lost their edge,” she said. “The ’94 Republicans, statistically, voted in favor of the prescription drug bill, the biggest entitlement since the 1960s, at the same rate as any other group. The realities of being in Congress, of trying to move up and get re-elected, have all sunk in, and many of those who have stuck around have obviously decided to not rock the boat.”
There is growing evidence, however, suggesting that the party had better rock the boat before Republicans fall out of it. “An increasingly large portion of the conservative base is saying there’s not a dime’s worth of difference between the parties, and that only hurts Republicans, never Democrats, come Election Day,” Dick Armey said.
Last March the Tarrance Group found Democrats holding a five-point lead over Republicans when it asked which party would keep down federal spending. A subsequent poll in August showed those numbers tighten into a dead heat, but clearly Republicans’ long-held reputation as the party of fiscal discipline is fast eroding, especially now that they control so much of the government.
“Congress cannot sustain a Republican majority without an enthusiastic base,” Pence said. “If we do not work towards the solutions we have been promising, it will kill the midterm election for us. Those are base elections, and the majority of our base is people who voted for us to see fiscal discipline in D.C. We abandon those folks at our own peril.”
THE ELEPHANT IN THE LIVING ROOM is President Bush. Whatever House conservatives plan for the budget, it is unlikely to get off the ground without White House backing. This means getting George W. Bush to locate the veto pen he didn’t pick up a single time during his first term.
“There is a broad coalition for fiscal discipline in Congress made up of moderate and conservative Republicans alike, alongside blue dog Democrats,” Ryan said. “But if the congressional leadership and the White House fail to step up and back us, the Appropriations Committee can defeat any reform legislation they choose to, because they hold the key to the money for people’s districts.”
Early signs are not promising. House Majority Leader Tom DeLay, for example, threatened to derail the entire omnibus spending bill last November by refusing to call it up for a vote if NASA did not receive the full $16 billion the agency wanted to send a man to Mars, among other projects. Even a trimming of $300 million during these times of fiscal crisis was deemed unacceptable by DeLay.
The White House’s willingness to compromise at the first sign of controversy could likewise endanger conservative goals.
“If the White House starts in the middle of the aisle and tries to work to the right, the entire reform agenda will be put in peril,” Pence said. “We’ve seen this happen many times these last four years, where the White House signals they’ll take any bill they can get. That doesn’t give conservatives a very strong hand at the bargaining table. If the White House starts in the middle and moves right, it will taint both the policy and politics of what we are able to accomplish.”
The general consensus in both the liberal and conservative press is that politics will overtake Congress in approximately 13 months. Any serious initiatives to reform the tax code, entitlements, Social Security, or budget practices in any meaningful way must begin before the sniping of the 2006 midterms begins.
“If we live up to our ideals, we’ll prosper,” Pence said. “If we fail, we run the risk of demoralizing millions of our most ardent supporters. It’s like Yosemite Sam always used to say, ‘Times a wasting.'”
Shawn Macomber is a reporter for The American Spectator. This article appeared in the February issue of The American Spectator. To subscribe, please click here.
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