The Danger for Republicans in Balancing the Budget
The Republican-controlled House and Senate are expected to pass budget resolutions this week. The House version would balance the budget in nine years, cutting spending by $5.5 trillion. The Senate’s is slightly different, balancing in 10 years with $5.1 trillion in cuts.
These votes will be the first act of the new Republican Congress that offers the public its vision of the future. It’s a vision that declares balancing the budget to be America’s top priority; that we should eliminate deficits as fast as possible, without raising net tax revenue or significantly affecting the military, even if it results in massive cuts for a slew of major programs.
What a strange stand for a political party to take.
This is no humdrum budget. It attacks sensitive areas like college grants and food aid for the poor. After repeatedly claiming, in election ads, that Obamacare cuts Medicare, the Senate GOP budget proposes its own $430 billion cut. Meanwhile, the House comes close to a $1 trillion Medicaid cut.
The Republicans are not nibbling around the edges. As the Center for Budget and Policy Priorities explains: “Spending on government programs other than Social Security and Medicare would fall to 7.2 percent of GDP in 2025 — 40 percent below the average of 12.2 percent of GDP over the past 40 years, and far below the previous post-World War II low (which was 9.4 percent of GDP in the late 1990s). In short, the federal government outside Social Security and Medicare would gradually become a shell of its former self.”
By taking social spending to the woodshed, the Republican budget comes with tons of downside political risk, especially for the seven Republican senators running for re-election next year in Democratic “blue” states.
But is there upside political reward for courageously proposing the tough medicine America needs? Not likely, for multiple reasons.
Most significantly, the nation’s gusher of red ink is running dry. Back when President Obama’s emergency stimulus required unprecedented borrowing and sparked the Tea Party uprising, Republicans hysterically warned, “We’re becoming Greece.” Back then the size of our annual deficits were topping out near 10 percent of GDP, much higher than normal. But today, the deficit sits at a manageable 2.7 percent of GDP, right near where the Simpson-Bowles deficit reduction commission aimed to hit by 2015.
Another factor robbing Republicans of bravery points is they lack the guts to spell out how they plan to achieve the vast majority of their cuts. Vagueness allows for slipperiness once the campaign attack ads come, but it doesn’t instill confidence that the Republican Party is serious about meeting their own goals.
Which may be why no one believes their plan is ever going to happen. At a recent gathering of House conservatives, Rep. Ken Buck opined, “I don't know anybody who honestly believes we're going to balance the budget in 10 years. It's all hooey.”
Maya MacGuineas, leader of a fiscal watchdog group that does believe we’re in a debt crisis, tried to counsel Republicans earlier this month to back away from a $5.5 trillion cut. Testifying before the Senate Budget Committee, she reminded them that that figure amounts to “65 times the size of the  Ryan-Murray [budget] deal, which you recall we didn’t stick to for very long.”
So if balancing the budget in 10 years using only spending cuts is impossible to achieve, probably unnecessary and politically risky -- and considering that budget resolutions aren’t even legally binding documents -- why would a political party put so much effort into crafting such a severely austere document?
Presumably the answer involves the long-standing problem of the Tea Party tail wagging the Establishment GOP dog. When Rep. Paul Ryan, not exactly a moderate squish, first ascended to the budget committee chairmanship, he proposed balancing the budget in about 30 years. After congressional conservatives complained, Paul later crafted balanced budgets in a 10-year timeframe.
But the arbitrary 10-year demand was formulated when conservatives still had Greece on the brain. Three years ago, Sens. Rand Paul, Marco Rubio and others wrote that “balancing the budget within 10 years seems a minimal threshold of fiscal seriousness” partly because “[a]nnual debt interest payments alone will soon be larger than the entire Greek economy -- which by itself is bringing Europe to its knees.” No one is making those hysterical arguments now. Shouldn’t Speaker John Boehner and Senate Majority Leader Mitch McConnell have the gumption to stand up to the right wing and resist their obsolete demands, in the name of political expediency?
The obvious reason not to is that Republican leaders need nearly every last Republican vote to pass a budget. In other matters that have divided the party, such as keeping the government open, Boehner can turn to Democrats to bail him out at the last minute. But Democrats would never vote for a Republican budget resolution of any sort. To lose conservative votes is to lose the budget, and expose a deep rift in a party to the public.
And yet, Boehner is picking a major fight with the Tea Party faction over the seemingly small matter of $20 billion slated for the Pentagon. The proposed budgets put $90 billion of defense spending in an “off-budget” account to circumvent spending caps under the sequester law, but that account currently requires the $20 billion be offset by spending cuts to be named later. Republican defense hawks fear the offsets won’t be found, jeopardizing the money. That would leave the Republican budget allocating less for the military than what’s in President Obama’s budget, and the hawks are already unhappy the GOP budget doesn’t propose more than the one from a president they have deemed soft on national security.
According to Politico, Boehner is siding with the hawks and planning to junk the offset provision. As a result, “[f]iscal conservatives are fuming.” Fox News’ Chad Pergram warns that “the effort could blow up in the Republicans’ face.” The leadership “can’t put a budget on the floor and allow an uncertain whip tabulation,” because that could give conservatives a parliamentary opening to knock the leadership’s budget off the floor permanently, and in turn, “break the House.”
The “war” (as Sen. Lindsey Graham called it) between the defense hawks and the fiscal scolds is forcing Boehner to choose sides, whereas no one was forcing him to choose between longer and shorter budget timeframes. But he ended up in a similar place, risking party unity to tell the far-right flank that their budgetary demands are untenable and unreasonable.
Eventually, Republicans will have to concede that a 10-year balanced budget timeframe solely dependent on social spending cuts is untenable and unreasonable. With a tough election around the corner, there’s no time like the present.