Terrific: Two-year budget deal removes all automatic spending restraints

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Published by: Dan Calabrese on Thursday February 08th, 2018

Congress can limit spending if it wants, but there is no longer an automatic mechanism to make it do so.

The way it usually gets presented to you, it's wonderful if Congress can agree to a spending bill, and it's a catastrophe if it can't. No spending authority to fund the operation of the government? Oh no! We'll all die!

Actually no we won't, and most of the time a "shutdown" doesn't shut down much of anything at all. But most people have been trained to think that agreement on a spending bill is what all Americans need if we're to continue living, breathing and eating.

There is a problem, though. Sometimes the spending bill (we used to have these things called "budgets") is a completely irresponsible document that overcommits the taxpayers and gives little or no consideration to restraints on spending. Since 2011 we had a thing called sequestration, a product of the Budget Control Act. It was far from perfect, but it did force some fiscal discipline by imposing automatic across-the-board cuts if Congress didn't figure out how to make prioritized cuts that prevented spending from growing too much.

No one in Washington liked this. Republicans hated the limits on defense spending, and Democrats hated the limits on all other spending. If they had worked to develop a responsible budget that put the money where it needed to be, and saved it where that was possible, sequestration would never have been an issue. But this is Congress, so, you know.

Anyway, buried in the headlines about how wonderful it is that leadership seems to have a two-year spending bill is the fact that this rare measure of federal spending restraint has come to an end:

The Budget Control Act of 2011 effectively had two sets of spending limits—an initial set of caps, and then a deeper set of cuts that kicked in only under the so-called sequester, which was triggered in 2013 after lawmakers failed to agree on a deficit reduction package. Earlier budget deals have reversed the cuts from the sequester but until now they held spending within the initial set of caps.

“This is the first deal that not only reverses the sequester, but busts the original spending caps,” said Marc Goldwein of the Committee for a Responsible Federal Budget, a fiscal watchdog group.

This is important because once lawmakers raise spending above the cap for just one or two years, it is very hard to return below them. “Deficit spending is kind of like an addiction. They say they just need one more fix, but it makes the next one easier,” said Mr. Goldwein. Also, unlike the tax cuts, which Republicans said wouldn’t add to deficits because they would boost growth, the spending increases in this bill “explicitly reverse past deficit reduction,” said Mr. Goldwein.

The latest deal underscores how difficult it has been for Washington to permanently rein in red ink by relying on cuts to discretionary spending programs, which account for just one third of all government outlays and aren’t the primary driver of future deficits.

Republicans have for years itched for increases to military funding, but Democrats have insisted any boost for the Pentagon should allow for increased spending on domestic programs.

The burst in spending doesn’t so much reflect a desire to stimulate the economy as it signals a pent-up frustration with years of outright spending cuts or increases that failed to keep up with inflation.

Now, there are still ways to restraint spending. Congress could decide to be more responsible in promising the taxpayers' money to everyone and anyone under the sun. President Trump could veto spending bills that spend too much. If they were willing to do these things, sequestration would never have been necessary in the first place. But like I said, this is Congress, so . . .

What seems likely to happen is that each party will agree to the other's desire for more spending, and federal outlays will balloon. Those in Congress who are inclined to vote against this because Washington is already spending way too much will be painted as mean old scrooges who want old people to die, children to get sick and poor people to suffer. Nothing is more important, we'll be told, than keeping the government running. Fiscal discipline is for villians and jerks.

By the way, the national debt will soon top $20 trillion, because no spending priority is ever OK to say no to. They're spending us into bankruptcy, but at least they passed a bill to authorize it! And with sequestration gone, there's nothing to restrain them now, except their own sense of responsibility.

Yikes.

Dan writes Christian spiritual warfare novels and does all kinds of other weird things too. Follow all his activity by liking him on Facebook!

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