November
9, 2005
It's Clear That No One Truly Wants To Reduce Deficits
By
Mort
Kondracke
If Washington, D.C., politicians were serious about fiscal discipline,
especially to prepare for the baby boom retirement crisis, they'd
raise taxes and cut spending. But they aren't serious.
As the debate
on budget reconciliation right now shows, Republicans are trying
to cut spending some and cut taxes more. Democrats want to raise
taxes some and spend a lot more. And the twain shall never meet.
Last month,
at the Democratic Leadership Council, Maya MacGuineas, who heads
the bipartisan Committee for a Responsible Federal Budget, proposed
a "grand bargain" between the parties. Democrats would
agree to cut entitlement programs, and Republicans would raise
taxes.
Her reasoning
was this: Federal tax revenues as a share of the gross domestic
product are 17.5 percent, which is close to historical lows. Outlays
now account for 20 percent, but as the baby boom generation retires,
they will rise to at least 25 percent and perhaps 30 percent.
"I think there is something just as inappropriate as cutting
taxes without cutting spending," she said. That is "promising
much bigger government in the future that somebody else will figure
out how to pay for."
Last week
Republicans and Democrats in Congress made it clear that on fiscal
policy, as on so much else, they are not in a grand-bargaining
mood. But actually, they are in a silent conspiracy to foist mountains
of debt onto their children and grandchildren.
In the Senate,
despite successful efforts by moderate Republicans to temper cuts
in Medicaid and other social programs, only two Democrats voted
for a budget reconciliation bill that cut spending by $35 billion
over the next five years.
In the House,
it appears, not a single Democrat will support a budget bill,
scheduled to come to the floor this week, that calls for $35 billion
to $54 billion in cuts, depending on intra-GOP negotiations.
In the Senate,
Minority Leader Harry Reid (D-Nev.) denounced the budget as "an
immoral document" that would "make the deficit worse."
"While
the majority has divided its budget in a way that obscures its
overall effect, nobody should be fooled," he said. "Viewed
as a whole, budget reconciliation would increase the deficit by
more than $30 billion. And after five years ... our national debt
would exceed $11 trillion." Reid is right so far: After they've
cut spending by $35 billion, Republicans plan on cutting taxes
by $70 billion if they can - for a net deficit increase of $35
billion.
But then,
what is the Democratic alternative? Well, there isn't one. Clearly,
Democrats would eliminate tax breaks for rich people, but they
have proposed no counter-budget in either the Senate or the House.
And, judging
by the amendments they've proposed, Democrats would increase spending
by at least as much as they could possibly raise taxes. There
is no official estimate of their plans, but Sen. Jim DeMint (R-S.C.)
has assembled a list of Senate Democratic amendments totaling
$460.7 billion over five years.
In the House,
conservatives from the Republican Study Committee have forced
party leaders and committee chairmen into a game of fiscal macho,
each going beyond the House's original budget resolution to find
additional cuts totaling nearly $54 billion.
Moderates
and Democrats complain, correctly, that some of the cuts - especially
in Medicaid, food stamps and welfare reform aid to the states
- disproportionately hit the poor, while proposed GOP tax cuts
disproportionately favor the rich.
Republicans
have declined to revisit the pork-laden transportation bill or
repeal tax breaks for profit-rich oil and gas companies as a way
of reducing the deficit. The House bill makes modest cuts in farm
subsidies, but the Senate voted down an amendment to limit individual
subsidies to $250,000.
Republican
moderates in the House seem unable to congeal around a specific
list of changes as a final budget bill gets assembled by the Rules
Committee. Some environmentalists are concentrating on the removal
of oil drilling in the Arctic National Wildlife Refuge. Other
critics want a repeal of permission to states to charge premiums
and co-pays by Medicaid beneficiaries. And others are drawing
a hard line on spending. "Some people mistake the moderates
as being closet Democrats," said Rep. Mark Kirk (Ill.), chairman
of the GOP Tuesday Group. "But we're not. We're all Republicans.
And most of us are fiscal conservatives who favor entitlement
reform."
"One
of the stories here," Kirk told me, "is that Democrats,
to a man and woman, are going to vote no, which means they have
no fiscal responsibility whatsoever.
"For
them, this is entirely political. If this bill goes down, their
votes mean that they want the deficit to be $50 billion higher
- half of it borrowed from abroad and more debt from your children."
So that's
the way it is, even between the moderates and the Democrats. Sadly,
you can expect a grand fiscal bargain only in some other lifetime.
Mort
Kondracke is the Executive Editor of Roll Call.
