Neither party wants to Cut Spending.....


EOG Master
[FONT=Times New Roman, Times, serif]November 9, 2005
[FONT=Times New Roman, Times, serif]It's Clear That No One Truly Wants To Reduce Deficits[/FONT]
[FONT=Times New Roman, Times, serif]By Mort Kondracke
[FONT=Times New Roman, Times, serif]
If Washington, D.C., politicians were serious about fiscal discipline, especially to prepare for the baby boom retirement crisis, they'd raise taxes and cut spending. But they aren't serious.
[FONT=Times New Roman, Times, serif]As the debate on budget reconciliation right now shows, Republicans are trying to cut spending some and cut taxes more. Democrats want to raise taxes some and spend a lot more. And the twain shall never meet.[/FONT]
[FONT=Times New Roman, Times, serif]Last month, at the Democratic Leadership Council, Maya MacGuineas, who heads the bipartisan Committee for a Responsible Federal Budget, proposed a "grand bargain" between the parties. Democrats would agree to cut entitlement programs, and Republicans would raise taxes.[/FONT]
[FONT=Times New Roman, Times, serif]Her reasoning was this: Federal tax revenues as a share of the gross domestic product are 17.5 percent, which is close to historical lows. Outlays now account for 20 percent, but as the baby boom generation retires, they will rise to at least 25 percent and perhaps 30 percent. "I think there is something just as inappropriate as cutting taxes without cutting spending," she said. That is "promising much bigger government in the future that somebody else will figure out how to pay for."[/FONT]
[FONT=Times New Roman, Times, serif]Last week Republicans and Democrats in Congress made it clear that on fiscal policy, as on so much else, they are not in a grand-bargaining mood. But actually, they are in a silent conspiracy to foist mountains of debt onto their children and grandchildren.[/FONT]
[FONT=Times New Roman, Times, serif]In the Senate, despite successful efforts by moderate Republicans to temper cuts in Medicaid and other social programs, only two Democrats voted for a budget reconciliation bill that cut spending by $35 billion over the next five years.[/FONT]
[FONT=Times New Roman, Times, serif]In the House, it appears, not a single Democrat will support a budget bill, scheduled to come to the floor this week, that calls for $35 billion to $54 billion in cuts, depending on intra-GOP negotiations.[/FONT]
[FONT=Times New Roman, Times, serif]In the Senate, Minority Leader Harry Reid (D-Nev.) denounced the budget as "an immoral document" that would "make the deficit worse."[/FONT]
[FONT=Times New Roman, Times, serif]"While the majority has divided its budget in a way that obscures its overall effect, nobody should be fooled," he said. "Viewed as a whole, budget reconciliation would increase the deficit by more than $30 billion. And after five years ... our national debt would exceed $11 trillion." Reid is right so far: After they've cut spending by $35 billion, Republicans plan on cutting taxes by $70 billion if they can - for a net deficit increase of $35 billion.[/FONT]
[FONT=Times New Roman, Times, serif]But then, what is the Democratic alternative? Well, there isn't one. Clearly, Democrats would eliminate tax breaks for rich people, but they have proposed no counter-budget in either the Senate or the House.[/FONT]
[FONT=Times New Roman, Times, serif]And, judging by the amendments they've proposed, Democrats would increase spending by at least as much as they could possibly raise taxes. There is no official estimate of their plans, but Sen. Jim DeMint (R-S.C.) has assembled a list of Senate Democratic amendments totaling $460.7 billion over five years.[/FONT]
[FONT=Times New Roman, Times, serif]In the House, conservatives from the Republican Study Committee have forced party leaders and committee chairmen into a game of fiscal macho, each going beyond the House's original budget resolution to find additional cuts totaling nearly $54 billion.[/FONT]
[FONT=Times New Roman, Times, serif]Moderates and Democrats complain, correctly, that some of the cuts - especially in Medicaid, food stamps and welfare reform aid to the states - disproportionately hit the poor, while proposed GOP tax cuts disproportionately favor the rich.[/FONT]
[FONT=Times New Roman, Times, serif]Republicans have declined to revisit the pork-laden transportation bill or repeal tax breaks for profit-rich oil and gas companies as a way of reducing the deficit. The House bill makes modest cuts in farm subsidies, but the Senate voted down an amendment to limit individual subsidies to $250,000.[/FONT]
[FONT=Times New Roman, Times, serif]Republican moderates in the House seem unable to congeal around a specific list of changes as a final budget bill gets assembled by the Rules Committee. Some environmentalists are concentrating on the removal of oil drilling in the Arctic National Wildlife Refuge. Other critics want a repeal of permission to states to charge premiums and co-pays by Medicaid beneficiaries. And others are drawing a hard line on spending. "Some people mistake the moderates as being closet Democrats," said Rep. Mark Kirk (Ill.), chairman of the GOP Tuesday Group. "But we're not. We're all Republicans. And most of us are fiscal conservatives who favor entitlement reform."[/FONT]
[FONT=Times New Roman, Times, serif]"One of the stories here," Kirk told me, "is that Democrats, to a man and woman, are going to vote no, which means they have no fiscal responsibility whatsoever.[/FONT]
[FONT=Times New Roman, Times, serif]"[/FONT][FONT=Times New Roman, Times, serif]For them, this is entirely political. If this bill goes down, their votes mean that they want the deficit to be $50 billion higher - half of it borrowed from abroad and more debt from your children."[/FONT]
[FONT=Times New Roman, Times, serif]So that's the way it is, even between the moderates and the Democrats. Sadly, you can expect a grand fiscal bargain only in some other lifetime. [/FONT]