The Corner

All Your Baseline Are Belong to Us

Last year, around this time, a whole bunch of us were predicting that the Democrats’ budget was really about stretching the baseline to give Dems more room to spend in future years.

Here’s what I wrote a year ago this week:

By spending hundreds of billions on things that have absolutely nothing to do with providing an immediate stimulus for the economy, Democrats hoped to make a down payment on their dream government. The billions for student aid, expanded welfare and health-care benefits, and bailouts for profligate state governments; the hundreds of millions for better museums and prettier government buildings; and the millions for smoking-cessation programs and bee insurance aren’t just items on crapulent Democrats’ wish list. The budget bloating was deliberate.

Remember what passes for a “cut” in Washington. Any decrease in the rate of increase counts as reduced spending. If you spend 20 percent more this year than you did last year, that’s a spending increase. But next year, that additional 20 percent is part of the baseline. And if your budget grows by “only” an additional ten percent, you’ve just “drastically cut” spending!

The stimulus bill was designed to give Democrats maximum maneuvering room. It would increase non-defense discretionary spending by more than 80 percent in a single year, in a single bill! Moving forward, they could grow government by smaller percentages while seeming to be responsible budget balancers. By putting chips on every square of social spending, they could let it ride for years to come.

Here’s the Wall Street Journal today in a great editorial:

President Obama sold the $862 billion in stimulus spending as “targeted, timely and temporary.” Critics said that was highly unlikely, and now the 2011 Obama budget has proven them right.

To wit, the White House is proposing to convert spending sold as a one-time economic boost into a permanent feature of future government growth. As both the Tax Policy Center and the Committee for a Responsible Federal Budget have pointed out, supposedly temporary parts of the stimulus—expansions of the earned income tax credit, the child tax credit and Pell Grants for college students—have now found their way into the budget baseline.

True to the way Mr. Obama has honored his campaign pledge of transparency, this news was buried in a footnote on page 170 of the budget’s Analytical Perspectives.

The baseline normally reflects “current law,” but the White House argues that this is unrealistic because Congress is never going to allow, say, the Alternative Minimum Tax to hit the middle class. Fair enough. But it also chose to smuggle these stimulus items into its definition of the “current policy” baseline and hoped that no one would notice.

The Responsible Federal Budget folks estimate that this fiscal sleight-of-hand would cost about $266 billion over 10 years, which by itself almost cancels out the White House’s spending freeze.

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