Arnold Kling  

Budget Arithmetic

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Douglas Elmendorf attempts to explain.


spending on Social Security and the major health programs is projected to rise from 8.7 percent of GDP in 2007 to 12.2 percent in 2021

Republicans do not like that the Bowles-Simpson plan envisions spending at 21 percent of GDP, instead of 18.5 percent. I wish that Republicans would stare at Elmendorf's numbers for a while, because 21 percent is looking pretty good compared with what we will face otherwise.

They also might want to take note of the fact that the Senate and the White House are in the hands of Democrats. I think that Bowles-Simpson is the best that either party can do right now. If one of them runs the table in the 2012 elections, then they can go for smaller or larger government, as the case may be.


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CATEGORIES: Fiscal Policy



COMMENTS (5 to date)
TA writes:

My vote for blog passage of the year. A marvel of realism in few words.

Radford Neal writes:

I find US politics puzzling. Doesn't your constitution say that a bill becomes law only if passed by both houses of Congress?

So if the Republicans control the House, and the Democrats the Senate, and the Republicans, but not Democrats, want to outlaw ballet, it doesn't get outlawed. Of course, if the Democrats, but not Republicans, want to outlaw auto racing, they might strike up a deal to outlaw both ballet and auto racing, but while I'm sure this sort of things happens occasionally, it doesn't seem to be the norm. I assume that's because the public wouldn't stand for such deals, with lawmakers voting for laws that they actually oppose.

So why the problem with the budget? Why aren't programs funded only if both the House and the Senate favour funding them? I assume the public somehow looks more favourably on lawmakers voting to fund things they think shouldn't be funded, but why? In particular, why can't the Republican-controlled House just pass a budget funding only what they want funded (and, let's suppose, nothing that the Democrats object to funding), and tell the Senate and the President that that's it - pass and sign it, or there's no funding for anything.

Brandon Berg writes:

Radford:
Under current law, spending on federal welfare programs (about 60% of the federal budget) will continue until the law is changed. The other 40% (about half military, half miscellaneous) must be specifically budgeted for each year.

In theory, the Republicans could refuse to do any annual appropriations until the Democrats agreed to change the law to reduce or slow the growth of programmatic spending.

I doubt this would go over well with voters, though. Really, this is probably more political theater than anything else. The Republicans had the chance to cut spending from 2003-2006 and chose instead to increase it significantly.

Many voters will say they want nonspecific cuts, but only a small minority of voters will endorse any realistic plan for reducing federal spending if you ask them about specifics.

Kevin Harris writes:

What TA said.

Blissex writes:

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