Big Lizards:Blog:Entry “A Good Start; Keep Plugging!”

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January 20, 2011

A Good Start; Keep Plugging!

Hatched by Dafydd

The Republican Study Committee, a conservative caucus within the House of Representatives that is chaired by Rep. Jim Jordan (R-OH, 100%), has proposed the Spending Reduction Act of 2011. But before taking a look, let's review the status quo.

Let's recall that the GOP leadership was talking about possibly, maybe, well not quite but close, cutting about $100 billion from the 2011 budget -- that is, cutting approximately 2.6% from total federal outlays as proposed by President Barack H. Obama in 2010. And let's also understand that the total Obama proposed includes hundreds of billions of dollars in fantasy spending cuts that the Left would never actually implement, coupled with hundreds of billions of dollars in "off-line" spending that is separately accounted. Realistically, real spending would likely be closer to $4.5 trillion under the generous hand of the Obamunist (always willing to dig down deep in your pocket and take until it hurts). So on Planet Earth, the Republican leadership is really talking about a robust 2.2% reduction. Wow.

Now back to the RSC's proposal; they begin with a much bolder goal:

Moving aggressively to make good on election promises to slash the federal budget, the House GOP today unveiled an eye-popping plan to eliminate $2.5 trillion in spending over the next 10 years. Gone would be Amtrak subsidies, fat checks to the Legal Services Corporation and National Endowment for the Arts, and some $900 million to run President Obama's healthcare reform program.

What's more, the "Spending Reduction Act of 2011" proposed by members of the conservative Republican Study Committee, chaired by Ohio Rep. Jim Jordan, would reduce current spending for non-defense, non-homeland security and non-veterans programs to 2008 levels, eliminate federal control of Fannie Mae and Freddie Mac, cut the federal workforce by 15 percent through attrition, and cut some $80 billion by blocking implementation of Obamacare.

(I've put the entire list of cuts, from the RSC Overview of their spending-cut proposal, in the extended portion of this post; click the "Slither on.")

Dividing $2.5 trillion by ten years yields an annual reduction (from proposed budgets) of $250 billion, two and a half times what the GOP top dogs first proposed, then walked back. Another way to look at it is that, instead of a yearly 2.2% reduction of the real spending mountain we face, the RSC proposes a yearly reduction of 5.6%.

So as I said, a good start. But there is another benefit if this proposal or anything close were enacted, perhaps after a lengthy negotiation with frightened Democrats; it would demonstrate that we can cut spending.

Actual spending reduction (as opposed to a reduction in the increase) is as rare as a Democrat with callused hands. Ronald Reagan and George W. Bush were able to significantly reduce taxes, but never spending. Bill Clinton, in concert with a newly Republican Congress (both houses), was able to balance the budget, but primarily by the fortuitous explosion of the computer/high-tech industry, which expanded the tax base... which itself had more to do with economic and regulatory policies initiated by Reagan than anything Clinton did. But I cannot recall significant spending cuts in my lifetime.

(Checking the budget history, there was a major spending reduction when World War II ended -- we were no longer supporting seven million men in the field, fighting half the world -- and a small reduction when the Korean War ended. But spending rose continuously throughout the Vietnam War and kept on rising after the war ended, not with a bang but a bug-out.)

Many Americans, having no experience with actually cutting spending from year to year, simply accept as read that it's impossible; but if we can demonstrate it before our very unbelieving eyes, then maybe folks will get all het up about cutting more and more and more. What Man has done, men can aspire to do!

With courage, perseverence, and good argument, we might be able to slash spending further and deeper than this nice jumping-off point from the RSC, down to a level that is actually comprehensible to mortal humans; at the very least, we should be able to slash Obama's ten-year deficit from $10 trillion to, say, only $3-4 trillion. And from there, it's only a short hop to a real balanced budget. And this time, once we have achieved balance through spending cuts, not tax increases, maybe we'll be diligent enough to keep it there.

On the other hand, if this proposal comes to nought; if it's watered down by the Republican nomenklatura in the House; blocked by the Democrats in the Senate; summarily rejected without even a nod towards negotiation by la Casa Blanca; and tossed in the dustbin of history... then it will have the opposite effect: It will confirm the initial thesis, that real spending cuts are literally impossible.

So this is very high-stakes political poker, and we're all-in on this one. Let's hope the RSC isn't just playing a stone bluff.

A complete listing of the spending cuts proposed by the Republican Study Committee

FY 2011 CR Amendment: Replace the spending levels in the FY 2011 continuing resolution (CR) with non-defense, non-homeland security, non-veterans spending at FY 2008 levels. The legislation will further prohibit any FY 2011 funding from being used to carry out any provision of the Democrat government takeover of health care, or to defend the health care law against any lawsuit challenging any provision of the act. $80 billion savings.

Discretionary Spending Limit, FY 2012-2021: Eliminate automatic increases for inflation from CBO baseline projections for future discretionary appropriations. Further, impose discretionary spending limits through 2021 at 2006 levels on the non-defense portion of the discretionary budget. $2.29 trillion savings over ten years.

Federal Workforce Reforms: Eliminate automatic pay increases for civilian federal workers for five years. Additionally, cut the civilian workforce by a total of 15 percent through attrition. Allow the hiring of only one new worker for every two workers who leave federal employment until the reduction target has been met. (Savings included in above discretionary savings figure).

"Stimulus" Repeal: Eliminate all remaining "stimulus" funding. $45 billion total savings.

Eliminate federal control of Fannie Mae and Freddie Mac. $30 billion total savings.

Repeal the Medicaid FMAP increase in the "State Bailout" (Senate amendments to S. 1586). $16.1 billion total savings.

More than 100 specific program eliminations and spending reductions listed below: $330 billion savings over ten years (included in above discretionary savings figure).

Additional Program Eliminations/Spending Reforms

Corporation for Public Broadcasting Subsidy. $445 million annual savings.

Save America's Treasures Program. $25 million annual savings.

International Fund for Ireland. $17 million annual savings.

Legal Services Corporation. $420 million annual savings.

National Endowment for the Arts. $167.5 million annual savings.

National Endowment for the Humanities. $167.5 million annual savings.

Hope VI Program. $250 million annual savings.

Amtrak Subsidies. $1.565 billion annual savings.

Eliminate duplicative education programs. H.R. 2274 (in last Congress), authored by Rep. McKeon, eliminates 68 at a savings of $1.3 billion annually.

U.S. Trade Development Agency. $55 million annual savings.

Woodrow Wilson Center Subsidy. $20 million annual savings.

Cut in half funding for congressional printing and binding. $47 million annual savings.

John C. Stennis Center Subsidy. $430,000 annual savings.

Community Development Fund. $4.5 billion annual savings.

Heritage Area Grants and Statutory Aid. $24 million annual savings.

Cut Federal Travel Budget in Half. $7.5 billion annual savings.

Trim Federal Vehicle Budget by 20%. $600 million annual savings.

Essential Air Service. $150 million annual savings.

Technology Innovation Program. $70 million annual savings.

Manufacturing Extension Partnership (MEP) Program. $125 million annual savings.

Department of Energy Grants to States for Weatherization. $530 million annual savings.

Beach Replenishment. $95 million annual savings.

New Starts Transit. $2 billion annual savings.

Exchange Programs for Alaska, Natives Native Hawaiians, and Their Historical Trading Partners in Massachusetts. $9 million annual savings.

Intercity and High Speed Rail Grants. $2.5 billion annual savings.

Title X Family Planning. $318 million annual savings.

Appalachian Regional Commission. $76 million annual savings.

Economic Development Administration. $293 million annual savings.

Programs under the National and Community Services Act. $1.15 billion annual savings.

Applied Research at Department of Energy. $1.27 billion annual savings.

FreedomCAR and Fuel Partnership. $200 million annual savings.

Energy Star Program. $52 million annual savings.

Economic Assistance to Egypt. $250 million annually.

U.S. Agency for International Development. $1.39 billion annual savings.

General Assistance to District of Columbia. $210 million annual savings.

Subsidy for Washington Metropolitan Area Transit Authority. $150 million annual savings.

Presidential Campaign Fund. $775 million savings over ten years.

No funding for federal office space acquisition. $864 million annual savings.

End prohibitions on competitive sourcing of government services.

Repeal the Davis-Bacon Act. More than $1 billion annually.

IRS Direct Deposit: Require the IRS to deposit fees for some services it offers (such as processing payment plans for taxpayers) to the Treasury, instead of allowing it to remain as part of its budget. $1.8 billion savings over ten years.