RSS Feed MenuIt’s been a couple of months since Pawlenty began pitching his new balanced budget constitutional amendment idea. It is finally making a stir, although it may not be the kind he wants. Pawlenty wrote a piece regarding the long-term federal deficit for the debut of the Daily Caller on Jan. 11th, which was promptly ripped by Stan Collender of Capital Gains and Games, and subsequently ripped again by Mathew Yglesias of Think Progress. Both accused Pawlenty of “not being ready for prime time” when it came to budget issues, and took him to task over details of the piece.
Collander focuses his critique on the following line, pointing out that Pawlenty’s focus on discretionary spending ignores the real problem.
Pawlenty wrote:
Balancing the budget will require some tough decisions. Congress must reduce discretionary spending in real terms, with exceptions for key programs such as military, veterans, and public safety. The Congress must also reject costly new spending initiatives, like new health care entitlements.
To which Collender responded:
Someone needs to tell Pawlenty that discretionary spending except for “military, veterans, and public safety” is less than $400 billion a year. A real reduction of, say 10 percent (a ridiculous amount but use it for simplicity sake) would save a little more than $40 billion from the baseline and that doesn’t come close to doing what needs to be done.
In addition, rejecting “costly new spending initiatives” isn’t the same as paying for the old ones, like Medicare and Medicaid, that are the real budget problems.
Yglesias concurs with Collender, concluding that if you don’t want to talk about raising taxes and slowing the growth of Medicare, you shouldn’t be talking about the budget.
Point taken. Yet Collender and Yglesias don’t address the implied results of Pawlenty’s proposal. A balanced budget amendment essentially returns the government to a pre-New Deal pay-as-you-go system, except in times of emergency. Thus, a balanced budget amendment would restrict spending on entitlement programs to a certain percentage of federal outlays, meaning that the programs would shrink drastically, and would fluctuate significantly year by year.
This is what Pawlenty is actually pitching, without actually talking about it. This is the real danger of moving forward with such a proposal for a slogan. Rapidly fluctuating entitlement spending could send regular shockwaves through the national economy, creating chaos and potentially prompting erratic short term tax measures. Will Pawlenty defend this proposal as viable when he gets stuck in front of a camera and finally has to answer to it? Even if this is just political positioning, is it really the best means of impressing Club for Growth type fiscal conservatives?
Pawlenty has better options than this. He has an all-star budget record during two terms as Governor of Minnesota. He has certainly used sophisticated solutions to solve complex problems in the past, why abandon that now?
RalfW // Jan 14, 2010 at 10:24 am
“He has an all-star budget record during two terms as Governor of Minnesota. ”
As a resident of Minnesota who ha closely watched all the budget goings-on of Pawlenty since his days as a legislator, I’d have to say his record is all-star only for Club-for-growth types.
Your description of wildly oscillating spending is exactly what is happening now – since of course our state does have a balanced budget requirement. In fact just this morning, public schools were warned that their already delayed and reduced spending will be subjected to an additional 5 month delay of $800 million dollars.
County hospitals are cutting ancillary care that people want (and can more often pay for) and that make our county hospitals the go-to, leading institutions, because Pawlenty painted himself into a desperate budget corner, requiring his massive unallotment gambit.
Having previously lived in Houston, TX where people only went to county hospitals in dire straits because private and charity hospitals were so much better, it came as a surprise to me that people frequently chose HCMC (Minneapolis’s fine county hospital) because they were such a good facility.
But Pawlenty’s doctrinaire cutting is endangering this and many other things that made Minnesota a great state. Yes, we were a high tax state. But we were a high-service, high achieving, high citizen satisfaction state.
Pawlenty has led the 8 year charge to make us just another middling, average, relatively dissatisfying state. This is no stellar record to run on.
aDude // Jan 14, 2010 at 10:43 am
The problem with the budget process is much more complicated than a simple Constitutional amendment. First, there is no single bill that encompasses the entire Federal budget. Even if the eleven or so separate appropriation bills were consolidated into a single bill that has to be voted up or down at one time, there are supplemental spending bills that crop up during the year. A truly comprehensive balanced budget amendment would end up with the complexity of the IRS code.
Besides, do we really want the Federal judiciary acting as the referee ultimately deciding Federal expenditures? Talk about opening the floodgates of litigation.
Most of these kinds of “solutions” are just weasel ways of avoiding telling the truth – there are very hard, very unpopular choices to be made, and no politician wants to be the one who, to paraphrase Buckley, stands athwart the tracks of popular spending and says “stop!”
I recall reading somewhere that not long from now, 95% of the Federal spending will be on defense, Social Security, Medicare, and Medicaid. And Medicaid will be much smaller, even with Obamacare, than the other three.
What politician from either party has the balls to tell say that Social Security and Medicare benefits are going to be cut? Or that we are going to reduce defense spending? Or conversely that we are heading for a Federal tax burden that will rise from today’s ~20% GDP to more like 30%? These are hard, unpopular choices that need to be placed before the voters.
I think my current disenchantment from any potential Republican candidate for 2012 is that I haven’t heard a single one lay out a detailed plan for what kind of spending on these four areas we would have in 2016 or 2020.
Balanced budget amendment proposals are a cheap way to appear fiscally disciplined while ducking the hard choices that need to be detailed at every election.
balconesfault // Jan 14, 2010 at 11:52 am
I’d like to have seen the funding process for the Iraq and Afghanistan wars under this amendment.
Or do wars get a bye, while all other spending gets restricted?
Or worse yet – does the supplimental funding for a war restrict discretionary spending in the next budget?
Ron Paul might like this. I’m pretty sure no other national politician would be willing to accept the consequences.