According to earthly logic, if you got a raise of 10 percent last year, but this year you got a raise of only 8 percent, you still got a raise. On Planet Washington, that qualifies as an indefensible slashing.
So when the GOP actually cut $4 billion from the budget last week, the Democrats acted as if it was an involuntary amputation.
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Now the GOP wants to cut $61 billion of discretionary non-defense spending from the total budget of $3.7 trillion, and Democrats are responding as if this will spell the end of Western civilization.
But given their terror of forcing a government shutdown in this tea-soaked climate, Democrats were forced to counteroffer with a cut of $10.5 billion, or 0.28 percent of the federal budget. Imagine you have a budget of $10,000 (about 40 percent of it borrowed on a credit card), then “slash” 28 bucks. That’s what it’s like to be a frugal Democrat.
Fox News Sunday host Chris Wallace repeatedly pressed Sen. Dick Durbin: Is $10.5 billion in cuts “really the best the Democrats can do?” The No. 2 Senate Democrat responded, eventually: “We’ve pushed this to the limit.” Any cuts beyond that would simply crater our economy and gut “investments” to make us competitive with China. Apparently, Durbin thinks trimming the staff at the Argonne National Laboratory will result in us all becoming busboys at a Beijing restaurant.
Meanwhile, Nancy Pelosi, the House minority leader, makes Durbin look stingier than the guy who invented copper wire by refusing to let go of a penny. Her solution to the deficit is — wait for it — to spend a whole bunch more. In October, Pelosi said that every dollar spent on unemployment benefits and food stamps puts another $1.79 into the economy. “It is the biggest bang for the buck when you do food stamps and unemployment insurance.”
If that were true, why not drop bags of cash from C-130s over the unemployed and poor?
Her latest version of teenage-mutant-ninja Keynesianism is to “invest” even more on education. “Nothing brings more to the treasury than investing in education,” Pelosi said.
Never mind that Washington has “invested” roughly $2 trillion in education since 1965. And forget the fact that spending on education at all levels of government has gone from $55,000 (in 2010 dollars) for one student’s K–12 student in 1970 to $155,000 in 2009, according to Cato Institute scholar Andrew Coulson, while “overall achievement has stagnated or declined, depending on the subject.”
Would another trillion in education spending really have a greater return than, say, allowing American companies to drill for the billions of gallons of oil under our soil and the trillions of cubic feet of natural gas? Don’t ask Pelosi. Like Bluto in Animal House talking about the Germans bombing Pearl Harbor, she’s on a roll.
Why am I talking about Durbin and Pelosi? Well, Obama is in a fetal crouch under the Oval Office desk, muttering something about the need for courage and bipartisanship while quietly proposing $6.5 billion in cuts, which the Congressional Budget Office said is really only $4.7 billion. (That’s about $700 million more than the U.S. spends in borrowed money every day. Imagine someone in obscene debt going a little more than 24 hours without using his credit card. Problem solved!)
Oh, and Senate majority leader Harry Reid seems determined to keep talking until the men in the white coats escort him off the Senate floor. He was last heard saying the GOP has gone crazy because it had cut funding to a cowboy-poetry festival in Nevada. No, really. Stop laughing.
Remember the days when $223 billion was considered to be a large annual deficit. That was last month's shortfall. This month's will be even bigger. Keynesian policy is to economics what bleeding is to medicine. Here's a superb statement of the problem from someone who would know, FDR's secretary of the treasury: "We have tried spending money. We have spent more than we have ever spent before and it does not work. ... We have never made good on our promises. .... I say after eight years of this Administration we have just as much unemployment as when we started...and an enormous debt to boot." Henry Morgenthau, May 1939. I hope America is smarter in 2012 than it was in 1940.
Jonah: Great article but one little nit. It's Argonne National Laboratory in Chicago not Oregon National Labratory (even if there is one). I know because I visited the lab in the 50's as a grade school student on a field trip to Chicago.
What would cause one to think they want to just keep spending at only 25% of GDP? There is no limiting factor in their thinking - right down to the fact that they do think they can figuratively dump cash out of C-130s and it will have a positive effect complete with a Pelosi multiplier. Their endpoint is when the federal budget is 100% of GDP, then they will control everything directly.
Be as clear and logical as possible, but they're in denial and not listening. They're more worried about the poor and defenseless. I'm guessing they'll be coming up with victims more sympathetic than cowboy poets and $150,000 bus drivers.
"Victims" like me who fear a decline in life style and unavailablity of all that healthcare has to offer in my retirement years. I'm convinced I have to accept economic reality - wherever in the unknown that may lead because there are consequences. Others, not so much.
Now that it appears Reid is signaling a willingness to consider deeper cuts that the 4billion defeated this week, it is time for the GOP to rush to meet his next paltry figure.
The GOP as a whole is an ignorant lot. 4 months since a decisive victory in November; 3 months since retreating (some) with concessions on extending tax rates (granted that was still the 111th) - anyone know the odds of Republicans remembering they have the leverage here? If nothing passes, even larger, more effective reductions occur.
(StarWars reference):
"Help us TParty Freshmen, you're our only hope."
The February deficit is on the order of $1,000 per person. (A little smaller, but in the ballpark.) Picture a family of four running up an extra $4,000 per month of credit card debt. How long can that go on? And it's every family in the country.
Not really. One has to keep in mind that what helped alleviate unemployment during WW2 was the fact that 16 million men and women served in uniform. And it wasn't as if the economy took off right after the war because of the release of pent-up aggressive spending my American consumers. It took a couple of years for the US economy to regain its footing after World War II, and much of our gains stemmed from the fact that we were about the only major power left standing directly unscathed from the war.
Krauthammer does indeed hint at the rope-a-dope strategy at play here. And it's not a bad tactic. Obama needs to round up his minorities/entitlement junkies/quixotic youngsters base in the same 2008 numbers to win. He also needs a large percentage of white voters. And what better way to do that than to say "Republicans want grandma and the children to die in the streets when they cut SS/Medicare/Medicaid"?
I have to take the cynic's view on this. I'll believe people will vote against entitlements that benefit them when I see it happen.
Democrats truely believe that there is no such thing as a govt that is too big. Beyond that, they believe that all good things come from govt, therefore, the bigger govt gets, the more wonderfull the world becomes.
For them, the answer to any problem is to tax evil rich guys more so that govt can spend more.
(Of course they define evil rich guy as anyone who's income does not already derive directly from a govt payout.)
You can always count on MikeB to trot out the most relevant, long since disproven liberal myth.
Mike, WWII had was only tangentially related with getting us out of the depression. What got us out of the depression was FDR eliminating most of the regulations and alphabet soup agencies he had created to govern us out of the depression. He had to do this in order to free up American industry to fight the war. Fortunately for the country, FDR died before the war ended so he never had a chance to reinstate his regulatory schemes.
"Why is it so hard for democrats to cut so little?"
Easy. Power. They don't wanna give it up. Let's not put too much trust in the repubs just yet, either. The difference, as of today, between reps and dems is adding another 12 trillion to the debt, or 13 trillion under the democrat plan in the next 10 years.
We can't let the repubs get away with lip-service to conservative ideas without acting on them.
Jonah doesn't actually manage to answer his title question, so I will. The reason it is so hard for democrats to cut spending by any meaningful amount is their own political existence. It has nothing to do with budgets or economics.
The modern democratic party exists to take money from productive sectors of the US economy and give that money to unproductive mascot constituencies based on bleeding heart PR spin. If it can't shovel more and more money in that direct every year, it has no reason to exist. There is no other reason anyone supports it, anymore. Naked personal grab is all it can offer.
Well, a party of pure grab that fails to grab anything is a party that has no purpose and that no one has any reason to vote for. That is all. If they stood for anything else, they could find another issue to appeal to their voters, but they do not.
MikeB,
WWII increased the GDP but it did not increase wealth. We were making tanks, planes, and guns not cars, houses, and radios. And at the same time running enormous deficits, as large as 25% of the total economy, that obviously were not sustainable over large periods of time.
Let's not lose focus on how pawltry the Republican cuts are - even in comparison with the Democrats even worse offering. As Rand Paul pointed out on the floor of the Senate the other day his proposed $500 billion in cuts only takes the annual deficit down by 1/3. As we contemplate rearranging the deckchairs here the Republicans and Democrats are fighting over who will play the tune. Utterly ridiculous. The Democrats are a farce and the Republicans are a joke. We need to put EVERYTHING on the table - eliminate entire departments and pull back from ALL unnecessary military deployments, i.e., acknowledge that WWII is 60 years gone and leave Europe, Japan and Korea. Abstention from looking at military spending is not a strategy.
Though I am a staunch fiscal conservative, I will say one thing in defense about Keynesianism in the stimulus - it wasn't tried. The stimulus was just a protect state government union workers from layoffs racket - but it didn't have to be.
Keynes was wrong that any government spending was stimulative, but it doesn't mean that some types can't be. Obama knew this when he spoke of "shovel ready jobs", but then had to admit their are none (and more to the point, no shovel ready projects that would create tangible assets that would help generate wealth like the Hoover Dam).
One of the ways Reagan helped to stimulate the economy in the 80's was to increase defense spending - build a 600 ship navy, etc. When the government buys real assets from the private sector it can indeed stimulate economic activity.
The Pentagon has recently awarded a contract to build a new fleet of tanker planes to Boeing. Boeing will buy machinery and equipment from other manufacturers and hire new employees in Seattle and Wichita. Those private sector workers will then build new homes buy new cars, etc., etc., etc. In other words use government money to create actual wealth in the private sector.
That's how the goverment can stimulate. All spending on more government workers and more welfare is just diverting funds away from new wealth creating activities.
(Now watch liberals loose their minds at the proposition that defense spending can be better for the economy than other forms of government spending)
NJ Jim
I can see your point. Democrats can't even do Socialism right. They could have modernized our infrastructure and public health system with the money they were playing with - and then crow about how government works. Well...so much for that strategy.
Another reason Democrats won't cut spending is because they believe taking money from the productive and giving it to the unproductive make the unproductive more productive while not affecting the productive. This is because they believe that money makes everything better, and is also the only reason anyone has money, i.e. the rich are rich because they're rich, the poor are poor because they're poor.
The thing to remember about government stimulating the economy is it's basically just bubble building. Take the Boeing contract. Once that is done, Boeing will have all these materials and people left over and nothing to use them for.
It is better to base the economy on a long term need, which requires making the US's resources more appealing, thus securing us more permanent contracts, thus permanently increasing the economy. Government stimulus, as shown with the New Deal, only increases the economy for as long as the government shoves money into it, after which the economy then deflates.
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