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Budget Blather 2012, Part 2: To Cut Spending, Republicans Increase Defense

The newly-Republican House made its first fiscal moves this week, submitting a bill that removes $100 billion in spending from the remaining seven months of the 2011 federal fiscal year. The total budget is about $3.7 trillion, so it's just a token amount, but it would cut spending on programs for the poor, and the environment, and other causes Democrats have been focused on. Selective defense program cuts are in there, but overall military spending somehow merits a two percent boost.

It also is a preview of the budget fight the Obama administration will have to face. House Speaker John Boehner claims that Republicans don't want to have to shut the federal government down to show that their serious, but he's not ruling it out, either.

The Fiscal Times has analyzed the whole thing, titled the Full-Year Continuing Appropriations Act, 2011, submitted by Rep. Hal Rogers, a Republican from Kentucky and Chairman of the House Appropriations Committee. Rogers said:

"It is my intent - and that of my Committee - that this [continuing resolution] legislation will be the first of many Appropriations bills this year that will significantly reduce federal spending.
You can see the actual bill here, all 359 pages. But reading it is of little value in understanding the big picture, because for the most part it announces just the new appropriations without saying what the old levels were. (For what it's worth, and just to show you that I at least looked it over, Division C of the bill prohibits the spending of any money not yet spoken for -- said to be $2 billion by The Fiscal Times -- under the American Recovery and Reinvestment Act of 2009, the big stimulus bill.)

In total, $19 billion of the cuts are security related, and $81 billion non-security related. Here are some of the cuts in detail, individual items over $500 million. (This summary is more manageable than the bill itself. ) The amounts are comparisons to the requests already made for 2011.

  • $1 billion -- Special Supplemental Nutrition Program for Women, Infants & Children (known as WIC)
  • $544 million -- Food For Peace
Commerce, Justice & Science
  • $1.125 billion -- State and local law enforcement and COPS hiring
  • $578 million -- NASA
Energy & Water Development
  • $899 million -- Energy efficiency and renewable energy
  • $1.1 billion -- Science
  • $647 -- Nuclear nonproliferation
Dept of Homeland Security
  • $820 million -- FEMA programs
Interior and Environment
  • $1.8 billion combined -- Clean Water and Drinking Water
Depts of Labor, Health & Human Services, Education
  • $1.6 billion -- Training and employment grants to state
  • $1.3 billion -- Community health centers
You get the picture -- lots of softhearted Democratic stuff. There are also many individual cuts to defense, but The Fiscal Times contends there is an overall increase to defense of two percent.

Democrat leaders immediately rejected the bill, says The Fiscal Times, quoting former House Speaker Nancy Pelosi saying: "Republicans are proposing an irresponsible spending bill that threatens job and economic growth, hampers our global competitiveness, and harms the people hurting most: working families and the middle class."

Speaker Boehner was on Meet The Press Sunday morning, promoting the spending cuts. When asked about the why he was cutting, say, job training, rather than making big cuts where the real money is, in the big areas of social spending or defense, he replied that everything is open to negotiation, suggesting we have a lot of wrangling to look forward to.

But he believes these cuts reduce the uncertainty that the Chamber of Commerce and other business lobbyists are still whining about, even after they got their tax cuts. That ensures a better environment for job creates. We'll see about that.

Will the Republican House force a shutdown of the federal government, as it did 15 years ago, when the federal debt ceiling needs to be raised in March? Mr. Boehner wouldn't say yes, but wouldn't say no either.

The issues that really need cutting and reconciliation are, of course, Social Security, Medicare and Medicaid. Together they make up $1.6 trillion of the total $3.6 trillion budget.

Americans don't understand the size of the problem, Boehner observed. Leaders need to help them see how big it is, and then lay out an array of possible solutions.

The Speaker's reasoning here isn't exactly consistent with the idea that America has to get serious and start cutting right away. It sounds to me as though we are in for reports from commissions, House and Senate hearings, and other political theater.

Thirty years ago President Reagan convened a commission to deal with the cost of Social Security, and while it didn't fix things forever, it did restore the solvency of the program for several decades, and we need an effort like that today. Let's hope the mainstream of the Republican party can ignore the shrill Tea Party views for a while and apply rational economics to our federal operations, so many of which are out of fiscal control.