Thursday, April 15, 2010

There are only three meaningful places to cut federal spending

Last Friday, I tweeted a link to an Economist poll in which 92% of Americans said that it was important to balance the federal budget within the next few years, and 62% said that the budget should be balanced with spending cuts alone instead of raising taxes (5%) or some combination of tax increases and spending cuts (24%). The notable part of this poll was that when participants were asked what, exactly should be cut, the average response seemed to be "not much, except for foreign aid" (which accounts for less than 1% of federal spending).

As a follow-up, I'd link to point to an article in the NYT today reporting the results of a poll and follow-up interviews with people who identify themselves with the Tea Party movement:
When talking about the Tea Party movement, the largest number of respondents said that the movement’s goal should be reducing the size of government, more than cutting the budget deficit or lowering taxes.

And nearly three-quarters of those who favor smaller government said they would prefer it even if it meant spending on domestic programs would be cut.

But in follow-up interviews, Tea Party supporters said they did not want to cut Medicare or Social Security — the biggest domestic programs, suggesting instead a focus on “waste.”

Some defended being on Social Security while fighting big government by saying that since they had paid into the system, they deserved the benefits.

Others could not explain the contradiction.

“That’s a conundrum, isn’t it?” asked Jodine White, 62, of Rocklin, Calif. “I don’t know what to say. Maybe I don’t want smaller government. I guess I want smaller government and my Social Security.” She added, “I didn’t look at it from the perspective of losing things I need. I think I’ve changed my mind.”
In order to make inroads into the federal budget, the only places where substantial cuts could make an impact are in Defense, Social Security, and Medicare/Medicaid, which together make up more than 59% of total spending. Of those three, only Defense is "discretionary," meaning that cuts could be made without requiring the passage of substantial new legislation.

I'm not against spending cuts. What I'm against is demanding that government shrink without a clear idea of where cuts should be made, and what the real impact of those cuts would be, especially when percentage of the federal budget (or percentage of the total deficit) is compared to impact on actual people's lives.

I think that the budget should (on the whole) be balanced. (Temporary but substantial deficits in times of recession would be the primary exception to this rule.) And I think that eliminating waste is a good thing. But when you're being told that government waste is the source of the problem, you're being lied to. The problem is the irresponsible tax cuts of the past 10 years, combined with fighting two wars on a different continent.

Many government programs help people, and they do so with a surprising level of efficiency. They help you. And that's worth paying for.

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