Last week, Senator John Kerry (D.-Mass) was unhappy with a Republican plan to cut as much as $61 billion out of the federal budget. “I think it’s an ideological, extremist, reckless statement,”Kerry said of the plan.
I hadn’t kept up on all the numbers recently, so I took a look at President Obama’s 2011 budget. My shock at the numbers was matched only by my shock that even Kerry could say something that demented.
The fiscal situation America now faces is unutterably appalling. I don’t want to bury you in numbers, so I’ll just mention a few, rounding out to the nearest hundred-billion.
First, the deficit is not just a few percentage points in the budget. Fully a third of all spending is now on borrowed money—that is, $1.3 trillion out of 3.8 trillion. That would be like spending $100,000 a year on a salary of $67,000.
If the President has his way, this situation will not change any time soon. He projects deficits approaching the trillion-dollar-range as far as the eye can see. And those projections assume that (1) ObamaCare saves money and (2) income tax receipts go up steeply in the next few years. Hah!
To balance the budget with more revenue, the federal government would have to take in 50% more cash. But if you raise taxes 50%, you won’t get 50% more money because the tax hike would hurt the economy, and people would find ways to avoid paying that much more. So to balance the budget with revenue, you’d probably have to double all federal taxes.
Congress has put most federal spending on autopilot rather than reviewing and appropriating it from year to year. (The Obama budget jocularly calls autopilot expenditures “mandatory” spending.) Autopilot spending includes Social Security, Medicare, and Medicaid, and amounts to $2.1 trillion. The entire rest of the budget is $1.3 trillion ($800B for defense and security; $500B for social programs). If you immediately abolished everything not on autopilot, you’d only barely balance the budget.
Even if we completely and immediately eliminated both Social Security and Medicare and kept their taxes in place we wouldn’t quite balance the budget.
So you can check the numbers yourself, here are the principal expenditures, rounded to the nearest hundred billion:
* Defense and other security programs – $800B
* Appropriated social programs – $500B
* Auto-pilot social programs – $2100B ($700B for Social Security, $500B for Medicare, $300B for Medicaid, and $600B for others)
* Interest on debt – $300B
Note that national security—the federal government’s first constitutional responsibility—absorbs only 21%. 79% goes to other programs, many of which are flagrantly unconstitutional. (This is in addition to state and local social spending.)
Study these numbers and three things hit you:
(1) The political and economic dynamics are such that balancing the budget will be forever impossible without radical change.
(2) Cutting $61 billion—about two percent of expenditures when the deficit is 33% of expenditures—is only “extremist” or “reckless” in a way opposite to what Senator Kerry intended.
(3) If we had honored the Constitution’s limits on federal power, this appalling situation never would have arisen.
In private life, Rob Natelson is a long-time conservative/free market activist, but professionally he is a constitutional scholar whose meticulous studies of the Constitution's original meaning have been published or cited by many top law journals. (See: www.constitution.i2i.org/about/.) Most recently, he co-authored The Origins of the Necessary and Proper Clause (Cambridge University Press) and The Original Constitution (Tenth Amendment Center). After a quarter of a century as Professor of Law at the University of Montana, he recently retired to work full time at Colorado's Independence Institute.
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