Saturday, June 3, 2017

Budget Porn for Libertarians and other Supporters of Limited Government

June 2, 2017 by Dan Mitchell @ International Liberty
 
Neither involves nudity, but I’ve written about libertarian porn and poverty porn.
To augment that list, my former colleague Brian Riedl, now with the Manhattan Institute, has produced some fiscal porn. Nothing sexual, so you can disregard this column if that’s your thing.

However, if you share my salacious interest in smaller government and more freedom, you’ll be squirming in your seat as you read parts of his column.

He starts with a simple observation.
President Trump’s…bold proposal to cut discretionary spending – excluding defense – from $619 billion this year to $429 billion a decade from now. That is a 30 percent reduction.
And Brian points out it’s a real cut, not a “Washington cut” that occurs when spending doesn’t rise as fast as previously planned.

I admit that my heart is beating faster.

But I shouldn’t get too excited. Brian points out that Trump doesn’t specify which domestic discretionary programs would get cut, either over the next several years or by 2027 when total outlays for that category are supposed to be $429 billion.
…the budget shows initial cuts followed by an across-the-board sequestration that would top $100 billion by 2027.
Brian doesn’t think politicians would want to accept a sequester.

I’d be happy with that outcome. Perhaps even pruriently happy.

But he may be right about the preferences of the political class.

So he decided to put together his own budget for domestic discretionary programs. In effect, a roadmap for lawmakers who may actually be serious about controlling the size and scope of Washington.
I extrapolate the budget’s own reductions, and fill in the remaining gaps based on my own experience crafting federal budgets for several leading presidential campaigns and working as a federal budget economist in the Senate.
He starts by going after the federal bureaucracy’s lavish compensation.
Federal employment and its generous compensation would be reduced. The federal civilian workforce could be downsized by 10 percent by replacing only one-third of the workers who leave their jobs ($7 billion saved in 2027), slowing the annual growth rate of federal civilian employee pay by half a percentage point ($12 billion), and requiring federal employees to contribute more to their own retirement plans ($7 billion).
I call this a good start. Not only is my heart racing, I’m flushed with anticipation.
Brian follows with ideas to raise revenue that – under D.C.’s bizarre budget rules – get counted as negative spending.
Other potential cross-agency reforms include raising user fees to better reflect program costs ($3 billion), and raising $10 billion annually by 2027 through modest federal asset and land sales (which Congress could classify as an offset to discretionary spending).
I don’t object to genuine user fees (such as setting entrance fees to national parks so costs are covered). And I certainly don’t object to selling federal land and other federal assets.

That being said, I prefer genuine spending cuts, so these provisions don’t excite me. My pulse has returned to normal. He’s ruined the mood!

But Brian then gets my heart racing again with some take-no-prisoners fiscal slashing.
With regard to specific programs, two-thirds of non-defense discretionary spending goes to federal operations, and the rest to state and local government grants. …federal operations could be targeted for deeper reforms. The Administration could shelve NASA’s human space exploration program ($10 billion), and halve the National Science Foundation and energy research (saving $6 billion). President Trump’s privatization targets include Amtrak ($1 billion); much of the Federal Aviation Administration (saving $10 billion); agriculture research ($1 billion); AmeriCorps and related programs ($1.5 billion); and the National Endowments for the Arts and the Humanities and public broadcasting ($0.7 billion combined). President Trump proposes cutting international spending nearly in half. Drastic reductions in the $45 billion foreign assistance budget.
I’m especially hot and bothered about what Brian suggests for Amtrak, the NEA, the CPB, and foreign aid.

And what he proposes for federal grants has me panting with desire.
…the completion of the interstate highway system leaves little reason for Washington to continue collecting the federal gas tax and redistributing it to states. Congress could save $40 billion in federal spending (and taxes) by eliminating the federal middle man and allowing states to collect and spend the tax themselves on projects of their choice. Other federal grant programs that could be devolved to states include housing aid to the poor (reduce by $30 billion and retain the final $10 billion for the hardest-hit states); means-tested food, child care, and home energy assistance ($10 billion); Head Start and other family service programs ($11 billion); job training ($6 billion); social services ($2 billion); economic development ($8 billion); justice ($2 billion); pollution control ($4 billion); disaster preparation ($2 billion); and numerous small public health grants ($6 billion). …lawmakers could freeze the two largest K-12 programs (special education and Title I grants to low-income school districts) at today’s combined $29 billion level, while eliminating dozens of small and largely unnecessary K-12 grant programs ($6 billion). Freezing Pell Grant spending at $24 billion, despite rising population, would require trimming either eligibility standards or the $4,860 annual maximum award.
A very good list, though I think he should get the federal government totally out of the education business, so his budget porn leaves something to be desired.

However, now for…ummm…the climax of Brian’s column (is that pun too obvious?).
Altogether, these reforms would reduce 2027 non-defense discretionary outlays to the $429 billion target proposed by President Trump.
And I must be young and virile, because the question that immediately comes to mind is what Brian can propose to get us to $329 billion. And then $229 billion.

By the way, Brian then ruins the mood with a final sentence. Maybe I’m reading it wrong, but I think he’s implying that the above cuts are too much and he’s only proposing them because Trump won’t address the old-age entitlements,
Such cuts are the price of balancing the budget without addressing the soaring Social Security and Medicare costs that are driving the deficit upwards.
My view is that we should bank all the savings to domestic discretionary that Brian identifies, accept all the reforms Trump proposes for Medicaid and other means-tested programs, and then add some reform of the other entitlements to the mix.

If Brian goes along with that, I won’t be upset if he doesn’t send flowers the next day.

P.S. If you’re looking for real porn, this isn’t the right website. I’ve commented (here, here, and here) on porn stars and politics, but you won’t find any “visuals.” Similarly, I’ve commented (here and here) on bureaucrats and porn, but you’ll have to use your imagination if you want some nakedness. And even when I’ve touched on the intersection of porn and public policy (here, here, and here), everything is PG-rated.

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