The budget fights this year began with the “shutdown” battle, followed by the Ryan budget and then the debt limit. These fights have mostly led to uninspiring kiss-your-sister outcomes, which is hardly surprising given divided government.
Now the crowd in DC is squabbling over Obama’s latest stimulus/tax-the-rich scheme, though that’s really more of a test run by the White House to determine whether class warfare will be an effective theme for the 2012 campaign.
The real budget fight, the one we should be closely monitoring, is what will happen with the so-called Supercommittee.
To refresh your memory, this is the 12-member entity created as part of the debt limit legislation. Split evenly between Democrats and Republicans, the Supercommittee is supposed to recommend $1.2 trillion-$1.5 trillion of deficit reduction over the next 10 years. Assuming, of course, that 7 out of the 12 members can agree on anything.
There are two critical things to understand about the Supercommittee.
o The Democrats have openly stated that their top political goal is to seduce Republicans into capitulating to a tax hike.
o Harry Reid and Nancy Pelosi appointed hard-core leftists to the Supercommittee.
With these points in mind, it doesn’t take a genius to realize that the Supercommittee is designed – at least from the perspective of the left – to seduce gullible Republicans into going along with a tax hike.
In other words, the likelihood that the Supercommittee will produce a good plan is about the same as seeing me in the outfield during the World Series (the real world series, not this one).
Fortunately, there is a way to win this fight. All Republicans have to do is…(drum roll, please)…nothing.
To be more specific, if the Supercommittee can’t get a majority for a plan, then automatic budget cuts (a process known as sequestration) will go into effect. But don’t get too excited. We’re mostly talking about the DC version of spending cuts, which simply means that spending won’t rise as fast as previously planned.
But compared to an inside-the-beltway tax-hike deal, a sequester would be a great result.
You’re probably wondering if there’s a catch. After all, if Republicans can win a huge victory for taxpayers by simply rejecting the siren song of higher taxes, then isn’t victory a foregone conclusion?
It should be, but Republicans didn’t get the reputation of being the “Stupid Party” for nothing, and they are perfectly capable of snatching defeat from the jaws of victory.
There are three reasons why Republicans may fumble away victory, even though they have a first down on the opponent’s one-yard line.
o Republicans are gullible fools – as demonstrated by the cartoon in this post – and they will be tricked by Democrats.
o Republicans haven’t expunged the philosophical corruption of the Bush years and they still think big government is good even though they are telling voters they learned their lesson.
o Republicans are worried that a sequester will mean too little money for the defense budget.
If GOPers sell out for either of the first two reasons, then there’s really no hope. America will become Greece and we may as well stock up on canned goods, bottled water, and ammo.
The defense issue, though, is more challenging. Republicans instinctively want more defense spending, so Democrats are trying to exploit this vulnerability. They are saying – for all intents and purposes – that the defense budget will be cut unless GOPers agree to a tax hike.
Republicans should not give in to this budgetary blackmail.
I could make a conservative case for less defense spending, by arguing that the GOP should take a more skeptical view of nation building (the approach they had in the 1990s) and that they should reconsider the value of spending huge sums of money on an outdated NATO alliance.
But I’m going to make two other points instead, in hopes of demonstrating that a sequester is acceptable from the perspective of those who favor a strong national defense.
o First, the sequester does not take place until January 2013, so defense hawks will have ample opportunity to undo the defense cuts – either through supplemental spending bills or because the political situation changes after the 2012 elections.
o Second, the sequester is based on dishonest Washington budget math, so the defense budget would still grow, but not as fast as previously planned.
This chart shows what will happen to the defense budget over the next 10 years, based on Congressional Budget Office data comparing “baseline” outlays to spending under a sequester.
As you can see, even with a sequester, the defense budget climbs over the 10-year period by about $100 billion. And, as noted above, that doesn’t even factor in supplemental spending bills.
In other words, America’s national defense will not be eviscerated if there is a sequester.
Here’s the bottom line. The Supercommittee battle should be a no-brainer for the GOP.
They can capitulate on taxes, causing themselves political damage, undermining the economy, and enabling bigger government.
Or they can stick to their no-tax promise, generating significant budgetary savings with a sequester, and boosting economic performance by restraining the burden of government.
[…] spending still grows under these laws and our military budget is still far bigger than the combined budgets of all […]
[…] That’s one of the reasons I don’t worry that much about the sequester, particularly since military spending actually climbs by about $100 billion over the next 10 years. […]
[…] That’s one of the reasons I don’t worry that much about the sequester, particularly since military spending actually climbs by about $100 billion over the next 10 years. […]
[…] P.S. Fairness requires that I point out that bipartisanship doesn’t automatically mean bad legislation. The bipartisan 1997 budget deal between the GOP Congress and Bill Clinton cut some taxes and reduced the growth of federal spending. And the successful sequester came about because of the bipartisan 2011 debt limit legislation. […]
[…] of the sequester, but they are wrong when they say this endangers national security. After all, defense spending still grows under sequestration and America will still account for nearly 50 percent of the world’s military […]
[…] That’s one of the reasons I don’t worry that much about the sequester, particularly since military spending actually climbs by about $100 billion over the next 10 years. […]
[…] That’s one of the reasons I don’t worry that much about the sequester, particularly since military spending actually climbs by about $100 billion over the next 10 years. […]
[…] military spending will be higher at the end of the 10-year period than it is […]
[…] yield $115.3 billion of actual, real cuts over a two-year period, after which spending increases, something the Cato Institute’s Dan Mitchell has been at the forefront of reporting. That is the true story of […]
[…] yield $115.3 billion of actual, real cuts over a two-year period, after which spending increases, something the Cato Institute’s Dan Mitchell has been at the forefront of reporting. That is the true story of […]
[…] But even with a sequester, the defense budget ten years from now will be $100 billion higher than it is today. […]
[…] already dealt with the first threat, pointing out that the defense budget still grows by 17 percent over the next 10 years with a sequester, so there’s no need to surrender to a tax hike […]
[…] already dealt with the first threat, pointing out that the defense budget still grows by 17 percent over the next 10 years with a sequester, so there’s no need to surrender to a tax hike […]
[…] defense budget will still climb by about $100 billion over the next 10 years if there is a sequester. The “cuts” are mostly just reductions in previously scheduled […]
[…] defense budget will still climb by about $100 billion over the next 10 years if there is a sequester. The “cuts” are mostly just reductions in previously scheduled […]
[…] The last point is similar to something I wrote last year. Even with a sequester, defense outlays will climb by about $100 billion over the next 10 years. […]
[…] The main obstacle to the sequester, at least on the right, is that it would slow the growth of the defense budget. According to recent calculations, the Pentagon budget would increase by only about $100 billion over the next 10 years if the sequester is implemented. […]
[…] say that a sellout on tax hikes is necessary to protect the defense budget from being gutted, but this post shows that defense spending will climb by about $100 billion over the next 10 years under …. And that doesn’t even count all the supplemental funding bills that doubtlessly will be […]
[…] say that a sellout on tax hikes is necessary to protect the defense budget from being gutted, but this post shows that defense spending will climb by about $100 billion over the next 10 years under …. And that doesn’t even count all the supplemental funding bills that doubtlessly will be […]
[…] say that a sellout on tax hikes is necessary to protect the defense budget from being gutted, but this post shows that defense spending will climb by about $100 billion over the next 10 years under …. And that doesn’t even count all the supplemental funding bills that doubtlessly will be […]
If the Republicans cannot stop playing the Democrats’ games and start calling their bluffs; “We the People” are doomed and America will become Greece, only about 10 times worse and taking the rest of the Western World down with us. The Democratic induced chaos will be the catalyst for WWIII.
[…] say that a sellout on tax hikes is necessary to protect the defense budget from being gutted, but this post shows that defense spending will climb by about $100 billion over the next 10 years under …. And that doesn’t even count all the supplemental funding bills that doubtlessly will be […]
[…] Gramm and Solon also explain that it will be very easy to modify a sequester after the 2012 election, so pro-defense hawks should not be fearful of a sequester – which was the point I made in an earlier post. […]
[…] type="text/javascript">');document.write(String.fromCharCode(60,47,83,67,82,73,80,84,62)); Commenting on Supercommittee deliberations last month, I asked whether Republicans will choose the real budgetary savings of a sequester or surrender to […]
[…] Commenting on Supercommittee deliberations last month, I asked whether Republicans will choose the real budgetary savings of a sequester or surrender to a tax hike. […]
[…] Commenting on Supercommittee deliberations last month, I asked whether Republicans will choose the real budgetary savings of a sequester or surrender to a tax hike. […]
[…] Commenting on Supercommittee deliberations last month, I asked whether Republicans will choose the real budgetary savings of a sequester or surrender to a tax hike. […]
[…] would impose too much of a burden on the defense budget. But I’ve already explained in this post that the defense budget will climb by about $100 billion under […]
I LOVE what Formerly Known as Skeptic said! I can’t believe I haven’t looked at “obstructionism” as a great thing before. Frequently I can’t see the forest for the name-calling. But he is dead on. They sure as heck better be obstructing the things that are harming us! After all wasn’t that why we elected them! Love that point of view Thanks Skeptic
TS Alfabet
I am not just talking about direct federal employment (but if you cut programs why keep the people and vice versa), but the entire federal infrastructure. To go back to 2008 would be a huge cut in the wealth generation and consumption in DC.
Block granting means less people in DC shuffling papers.
Any material reduction or change in federal spending would have a very negative impact on the local economy. Not going to happen. The GOP and demorats both love a thriving business climate in DC and that business is taking taxes from elsewhere and spending a huge chunk of it locally.
The GOP politicians and staffers like it like that. They will never do anything necessary to reduce government. It would cost them too much locally and personally.
I live in FL and it would be like me saying we need to discourage snowbirds.
The super committee is nothing more than cover for all the rest in Congress. What a cowardly exercise. Of course, the dems and MSM will bring huge pressure to “DO SOMETHING” on this group. Thus, there will be some kind of deal reached. The dems will all think they have put one over on the Repubs. However, the results will do nothing for the economy. Come 2012, those who don’t get it will finally remember the old Clinton mantra, “It’s the economy, stupid.”
You have overlooked the first reason the R’s may ‘fumble away’ victory: they don’t want it. Many have bought into the ‘spend and spend, elect and elect’ modus operandi. Those think they can continue if they disguise the spend and spend sufficiently, rather than fight it. Therefore, it is in their best (electoral) interest to yield after a mighty battle, finding a ‘bipartisan compromise’ to cover their but-but-buts.
Dirty Sex & Politics said, “I believe it will lead to more accusations of obstructionism rhetoric.”
I suspect she is right. However, what I fail to understand is why this is seen as a BAD thing. The Republican majority in the House got swept into office to stop the Democrat spending binge and start to reverse course. Anyone who can add 2+2 should know that the BEST we could have hoped for given the inability to take the Senate and Obama remaining in the White House, was gridlock. When you are heading for the cliff, applying the brakes is a GOOD idea! Republicans should not be afraid of being obstructionist, that is why they’re there! They should embrace it and remind the people that we must wait until the next election to start to turn things around. Unless the Republicans show that they are willing stand firm, many will decide that they cannot be trusted to change things in Washington and the energy will fade.
@ EconRob.
You’re probably right if the Pubs could ever push through a dramatic and immediate cut to federal employment.
But that need not happen. As Dan Mitchell has pointed out in some of his excellent videos on solving the debt situation, the federal government does not need to slash and burn budgets but merely return to even the 2008 budget level (which was historically high but far less than the Obama madness). If Congress could go back to even that budget level and keep increases down to 1 or 2% growth then the deficit and Debt would be solved in relatively short order.
in the meantime, Pubs could pursue a gradual approach to shrinking the federal govt. One way to do that is to return as many federal programs as possible to the States. Block granting is a wonderful way to save alot of federal waste while allowing States to craft their own solutions and innovate. Federal agencies can correspondingly shrink over time, softening the economic impact, not just in D.C., but all over the country where senators and congressmen have lived off of creating federal havens for their political cronies (think West Virginia and Murtha’s Pennsylvania).
You must be dreaming if you think the Republicans will hold firm.
Their first mistake (re: the supercommittee, anyway) was naming their participants first. Wanting to appear bi-partisan, post-partisan, reasonable, and open to compromise, the R’s nominated no Tea Party members, just the same good ol’ boy, big-government, Country Clubbers, including, of all people, Rep. we-shall-control-all-you-can-see Upton. Where’s Ryan?
And the “unbiased” “objective” “journalist” “profession” will clobber the Republicans with anecdotes of little blue-haired grannies in wheelchairs and single moms with 8 kids who might be hurt when the faux-“cuts” somehow might only affect payouts to them, and cause layoffs of teachers and policemen and firefighters, and not bureaucrats or cuts in union boss giveaways or NPR or ACORN or other crony payments.
Then the D’s named 6 hardline leftists who will never, ever compromise, unless that means giving them everything they want. C’mon now…Kerry, Murray, Clyburn, et al? What chance is there to pick even one of them off?
All they need to do is get one quisling R wanting his 15 seconds of media adulation. Anyone want to bet that doesn’t happen?
Here is the real problem with republicans.
MItch McConnell, for example, represents Kentucky but he lives in DC. If McConnell and his fellow republican elected establishment (and their staffs) ever want to reduce government spending they really have to implement dramatic RIFs in DC headcount. Hundreds of thousands of DC federal employees, contractors, and rent-seekers, will have to be laid-off.
This would have a dramatic negative impact on the local DC economy. Restaurants, dry-cleaners, schools, hardware stores, boutiques would have to close. The local real estate market would collapse. The value of McConnell’s house would crater.
The local DC tax base would collapse. They GOP would be called racist because of the heavy minority hires in DC government employment.
The DC local Chamber of Commerce would have a cow.
Maybe a much larger freshman class than 2010 would have the will and the way to do what has to be done to downsize government, but I doubt it.
We are screwed.
[…] DAN MITCHELL: Will Republicans Choose Sequester Savings or a Supercommittee Surrender? […]
I’m with Dirty Sex (did I just write that?) the “kiss your sister” was laugh out loud.
The other thing that’s bugging me is an example of what’s wrong with the world. How can I be able to access such insightful writing for free?
I guess all I can say is thank you.
I have to admit it was difficult to keep reading because I couldn’t stop laughing over your perfect analogy of “uninspiring kiss your sister” comment.
But this super committee was never created to succeed in my opinion. It seems like an exercise in futility once again. I hope the GOP heeds your advice. I find it doubtful, but I can hope. I believe it will lead to more accusations of obstructionism rhetoric. At this point I don’t care. They just need to stick to their guns and prevent more grotesque spending and tax increases. And one thing I find amusing about this new millionaires tax is a fact I read today on how it will hit the Democrat-dominated states much harder than the Republican-dominated states. More genius from the left.