Friday, February 11, 2011

Abysmal Ignorance of the American Budget Cutters

Filed under: Economy — by Will Kirkland @ 2:53 pm
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From Bruce Bartlett at The Fiscal Times:

One of the biggest problems we have in dealing with the budget is the gross level of budgetary ignorance on the part of the public that I detailed last week. But an even bigger problem is that Republicans in Congress appear to be just as ignorant about the actual impact of the grandiose spending cuts they repeatedly claim they are going to enact immediately. In coming weeks, everyone is going to get a very fast and very rough education on the real effects of slashing government spending.

On Feb. 9, House Appropriations Committee chairman Hal Rogers, R-KY, announced$74 billion in budget cuts in fiscal year 2011, which began on Oct. 1, 2010. Enacting large budget cuts in the current fiscal year when it’s almost half over is very foolish. Congress can’t cut spending that has already been spent, so it must cut very heavily from a small spending base to achieve meaningful savings.

Scott Lilly, who was staff director of the House Appropriations Committee, explains another problem. Because the Republicans are cutting the budget in such haste, many members, including those on the Appropriations Committee, really have no idea what is going on or what the effects of these cuts will be on people and programs. As Lilly explains:

“With many of the 93 freshmen members of the House still asking rudimentary budget questions such as: ‘what is the difference between an authorization and an appropriation?’ or ‘how do outlays differ from budget authority?’ the time frame that Rep. Rogers and his leadership are committed to means that not only will those voting on the proposal have little opportunity to understand it but the authors themselves will not have fully vetted or completely understood what they are proposing. There have been no hearings, no requests for testimony, and no opportunity even for staff charged with proposing the cuts to do agency-by-agency analysis of the possible negative consequences. Members will vote next week on the package without fundamental knowledge of how major budget changes in literally thousands of federal programs will impact the country in general or their own constituents in particular.”

In another commentary, Lilly explains how the meat-ax approach to budget cutting that Republicans have adopted would affect one agency, the Federal Bureau of Investigation:

“It has been operating at an annual rate of $7.8 billion since October. (The threat of a Senate filibuster in December forced Congress to abandon efforts to complete legislation that would have funded the president’s request to increase FBI funding to the level above $8 billion a year.) Since we will soon pass the halfway mark for the current fiscal year, the Bureau has already spent close to half its $7.8 billion. [House Budget Committee chairman Paul] Ryan’s proposed cut of $44 billion applied across the board to all programs in the one-eighth of the budget subject to cuts would result in reducing FBI spending by almost $750 million, leaving it with less than $3.2 billion for operations for the remainder of the year — about 19 percent less than operated on for the first half of the year.”

The point is not that there are no government programs worthy of cutting, but rather that this is a really stupid way to do it….

And a follow up with some numbers on those who receive benefits and think they don’t, by Catherine Rampell at NY Times

1 Comment

  1. GrannyBG:

    Economies like houses require a solid foundation and a distribution of wealth that is not too top heavy. (think of what snow on a roof does)

    But our economy has been getting increasingly top heavy over the past 30 yrs…and the walls and foundation can’t support such a heavy roof much longer.

    And the foolish persons who seek to profit at the expense of the foundation are in fact calling for the ruination of democracy and our economy in one fell swoop.

    We are not “workers”/serfs/etc…we are citizens and we our government is being wrested from us.

    Good website re economy, wealth & power:
    http://sociology.ucsc.edu/whorulesamerica/power/wealth.html

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Words for Acts

The least pain in our little finger gives us more concern and uneasiness than the destruction of millions of our fellow-beings.

-William Hazlitt, essayist

(1778-1830)



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