|Conservatives Have Won Some Spending Victories|
By Quin Hillyer
Wednesday, March 06 2013
Conservatives have become so accustomed to blasting Republican congressional leaders that sometimes we don’t realize we’re winning some victories. Such is now happening with the ongoing spending battles, during which, by trial and many errors, Speaker John Boehner and Senate Minority Leader Mitch McConnell have somehow accomplished more than most conservatives credit.
In fact, some of the “surrenders” for which conservatives most vociferously criticized them are exactly the agreements that led to current successes. Specifically, the “debt limit” deal in the middle of 2011 and the “fiscal cliff” deal reached on January 1 of this year both worked to stop the explosion of discretionary spending, and at least temporarily to roll back those appropriations.
Let’s re-examine the 2011 agreement. Republicans entered the battle insisting that spending be cut by at least as much as the limit would be raised. The Left wanted a “clean” hike in the limit, with no conditions. And what resulted? Despite conservative caterwauling, the political right won the day: Spending would be “cut” (from existing baselines) in an initial bite of $900 billion, and by $2.1 trillion over ten years, while the debt ceiling, too, would rise by $2.1 trillion.
Conservatives grumbled, however, that the promised second portion of that, $1.2 trillion, would never materialize. The fears were wrong. Some conservatives underestimated the power of the sequester that was the ultimate guarantor of savings. Unlike Appropriations bills – where Congress must act to fund any government at all and thus where the incentives are to nab as much spending for each special cause as possible – sequestration happens without Congress doing a single thing. Absent new action, it is automatic. Advantage: Fiscal conservatives.
When the congressional special committee charged with finding the remaining savings achieved no agreement, the sequester was baked in the cake. It was timed, however, to go into effect at the exact same time as the expiration of the Bush-era tax cuts that the Left so detested. Without any action, taxes would rise by many trillions (over ten years), and spending would be cut another $1.2 trillion under the “baseline.”
So, what finally happened? Congress saved all but $600 billion of the tax cuts – and kept on track the entire $1.2 billion of spending reductions. But conservatives still didn’t trust in the spending reductions, because the sequester itself was delayed another two months.
Well, now the sequester has finally occurred, as set into law in 2011. The total amount of “savings,” in terms of discretionary budget caps going forward, is indeed $2.1 trillion – and the first two-plus years of those savings have already been implemented. Better yet, the House passed on Wednesday a Continuing Resolution for 2013. If also passed by the Senate, which will not come without a fight, that would further ensconce this year’s savings into law, and also provide flexibility within Pentagon accounts to protect essential programs, lessen the “pain” and thus significantly diminish the political fallout against conservatives.
As for “tax hikes,” compared to where the law stood in the summer of 2011, Americans are far better off. Rather than income taxes going up, without congressional action, on almost everybody, income-tax rates went up on only about four percent of the population – while, in a real victory, the $5 million exemption from death taxes not only was salvaged, but actually was made permanent at $5 million and indexed for inflation.
Critics will scoff, though, that the cuts come not in actual dollars but instead in comparison with a rising “baseline.” Yes, that’s true – but the new numbers actually aren’t bad. In 2010, federal non-defense discretionary spending was $550 billion. In 2011, it dropped to $510 billion. In 2012, it rose slightly to $526 billion; and this year, with the sequester, it will drop to $508 billion. In the last three years, then, combined domestic savings in actual dollars are $106 billion – which, adjusted for inflation, is the equivalent of $181 billion in 2013 dollars.
Even after 2013, things don’t look awful. Pre-sequester, 2014 domestic spending was slated at $550 billion – no higher than four years earlier. (That number should drop with sequestration.) The numbers after that originally were $557 billion, $568 billion and (in 2017) $580 billion. Those hikes themselves (averaging less than 1.7 percent per year) are unlikely even to keep pace with inflation, not to mention the original, more rapidly rising “baseline” that also took into account population growth and other liberal wiggle room.
Conservatives are right that none of that does anything to reform entitlements, which are the real drivers of deficits and debt. We should recognize, however, that against a leftist Senate and a hard-left president, congressional Republicans have succeeded in halting growth in the parts of government the House directly controls through its annual spending authority.
Much, much more remains to be done, of course. And nobody, including Boehner himself, could claim with a straight face that Republican leaders have used the canniest tactics or that they avoided taking unnecessary lumps both political and substantive. Nonetheless, the spending momentum has shifted slightly in conservatives’ favor – and the politics are now shifting too. It’s a long ballgame, and the liberals’ lead is shrinking.
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