“For several years now, this town has been consumed by a rancorous argument over the proper size of the federal government. It’s an important debate.”
– President Obama’s 2014 State of the Union
WASHINGTON – Well, there’s a presidential whopper.
Obama is right that the role of the federal government deserves an important debate, but he is wrong when he says that we’ve had that debate.
Just the opposite: The White House and Congress have spent the past five years evading the debate.
They’ve argued over federal budget deficits without addressing the underlying issues of what the government should do, what programs are unneeded, whether some beneficiaries are undeserving, and how to raise taxes to cover the inevitable gap between what the government spends and its existing revenues.
The avoidance is entirely bipartisan. Congressional Republicans have been just as allergic to genuine debate as the White House and its Democratic congressional allies.
There is no secret as to why. The math of budget balancing is politically toxic.
Even over a period as long as a decade, budget balancing would require both unpopular spending cuts and unpopular tax increases.
Republicans can’t cut their way to a balanced budget through lower spending. Eliminating many programs that are arguably marginal – Amtrak, subsidies for public broadcasting and the like – would not produce enough savings to balance the budget.
The reason: Spending on Social Security, Medicare and other health programs will increase 21 percent, as a share of the economy, by 2023, projects the Congressional Budget Office. This mostly reflects a flood tide of retiring baby boomers. But even plausible benefit trims for affluent retirees would still leave deficits. There would still be a need for tax increases.
Similarly, Democrats can’t plausibly tax their way to a balanced budget – at least with taxes only on the rich.
By 2023, existing budget plans already call for spending cuts approaching 40 percent in defense and non-defense “discretionary” programs (everything from Head Start to environmental regulation).
Despite these cuts – also as a share of the economy – the Congressional Budget Office projects that balancing the budget in 2023 would require about a 25 percent tax increase from the average 1973-2012 tax level.
Restoring some defense and domestic cuts would boost the needed tax increase. Expanding Social Security benefits (as some liberals propose) would do the same.
Balancing the budget is hard political work because it requires both parties to retreat from entrenched political positions. Republicans would have to concede the need for significant tax increases, Democrats for significant spending cuts, including Social Security and Medicare.
What we desperately need – and haven’t gotten – is a generational reappraisal of government’s role.
Instead, the White House and congressional leaders have embraced various subterfuges. The goal is not to balance the budget but to keep government debt at “sustainable” levels – an intellectually mushy concept that’s almost impossible to explain to non-experts.
Rather than make explicit choices among deserving and undeserving programs and beneficiaries, Congress adopts across-the-board cuts (aka, the “sequester”) that lump many programs together.
What results is an exercise in public confusion. The idea is to give the impression that a great deal is happening, though hardly anyone (outside, again, budget “experts”) can say just what or to whom.
Basic questions are not being asked or answered. The proof is the farm bill now moving toward congressional approval. We no longer need to pay farmers billions annually to raise corn, wheat and other commodities that they would raise anyway, but that’s what we’re doing. We’re doing it because farmers expect subsidies and congressional committees derive their power from providing them.
The evasion of debate fosters mediocre government. The sequester’s automatic spending cuts, even as modified last year, are slowly gutting the military and important domestic programs.
Meanwhile, putting most retiree programs off-limits undesirably protects many affluent retirees.
We should debate these choices openly. In practice, the debate has been a cover-up.
Samuelson’s columns, including those not published in the Journal, can be read at ABQjournal.com/opinion – look for the syndicated columnist link. Copyright, The Washington Post Writers Group.