There’s some budgetary progress taking place in Washington D.C. — if lawmakers don’t abort it.
October 1 marked the beginning of a new fiscal year and, according to the Congressional Budget Office, the deficit for FYE 2015, which wrapped up September 30, is down considerably. At $500 billion it’s still outlandish, but a huge improvement over the trillion-dollar annual deficits during this Administration’s first term.
This improvement is due to budget restraint demanded by the tea-party voters that resulted in passage of the Budget Control Act of 2011. The law was a compromise that ended a standoff over raising the debt ceiling, the borrowing limit that lawmakers keep raising to get the nation’s bills paid. The legislation put in place a tool called sequestration, in which automatic, across-the-board spending cuts are triggered if spending exceeds certain caps. This put a stop to the spending spree that was taking place, giving us the first three-years-in-a-row reduction in federal spending since the 1950’s. The sequester cannot be broken unless Congress allows it.
The results from this have been impressive. In 2009 federal spending accounted for 24.4 percent of the nation’s Gross Domestic Product. In 2014 it was 20.3 percent of the economy. An increase in the spending caps and the rising costs of the national health care program brought it up to 20.6 percent for 2015.
Listen, the government is still way too big. But, as The Wall Street Journal’s Stephen Moore observes, “it looks as if budget restraint in D.C. is beginning to waiver. He points out that, “Congress and the White House are quietly negotiating a deal for the new fiscal year that would bust the spending caps that have brought down the deficit.” Steve Moore says, not only is this bad policy, it’s bad politics. A good chunk of the Congress was elected promising budgetary discipline.
The pain from cuts in domestic spending has been minimal. But liberals are itching for increases in social programs. The caps fall disproportionately on the military, half the cuts came from the armed forces, which comprise only a fifth of the budget. Even with the drawdowns in Iraq and Afghanistan, military leaders are warning of damage if some increases don’t come soon.
There’s a lot of pressure right now, from both sides of the aisle, to bust the spending caps. Moore says this “will only reverse progress toward a balanced budget, fatten liberal social programs, and confirm what many tea-party voters have been shouting for years: that Republicans break their promises once elected.”
The Journal’s Steve Moore, who is also co-founder of the Committee to Unleash Prosperity, says Congress should keep the caps in place and hope the next president will cooperate in rebuilding the military by “shifting dollars out of wasteful domestic programs.”
Are there some political costs to holding the line on spending? Yes. But breaking promises of budgetary discipline will cost a whole lot more.