Roosevelt Institute | Cornell University

Spending Cuts are Hard

By Victor ZhaoPublished May 1, 2013

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By now, we are more than familiar with proclamations of wasteful government spending; Republicans have been on the drumbeat about the size of the federal budget deficit for seemingly forever (actually, since Barack Obama replaced the last Republican president in the White House). But it isn't just the Republicans who are guilty of this; Democrats, too, including President Obama, have made a premature pivot to deficit reduction, by proposing cuts in a number of social programs funded by the federal government.
By Victor Zhao, Published 5/1/13

By now, we are more than familiar with proclamations of wasteful government spending; Republicans have been on the drumbeat about the size of the federal budget deficit for seemingly forever (actually, since Barack Obama replaced the last Republican president in the White House). But it isn’t just the Republicans who are guilty of this; Democrats, too, including President Obama, have made a premature pivot to deficit reduction, by proposing cuts in a number of social programs funded by the federal government.

This is not a defense of government spending, although cutting spending now just when the economy is beginning to exhibit signs of growth is a mistake (some spending is better than no spending, and, as Keynes famous said, we are all dead in the long run). The inefficiencies of government largesse are many and well-documented.  Many government expenditures sound nice in the abstract but are messy to implement in reality. Disability benefits, for example, are theoretically sound; those who have medical conditions making it impossible for them to work should not be left out on their own but be given some sort of assistance by the government. In practice, however, it is difficult to characterize or define a disability. When do normal aches and pains become out of the ordinary? How severe must an injury be for the affected person to be considered unable to work? Ultimately, these are judgment calls of individual actors that cannot be feasibly and effectively regulated by the government. Inevitably, some amount of waste will result.

Cutting government spending in a responsible manner, however, is hard to do. The simple reality is that behind each spending program is a constituency that benefits from the spending, and will fight to keep it. That translates to a real impact at the ballot box, as affected voters are more likely to be passionate about the particular issue, even as the majority of voters dispense with the time and effort to educate themselves and make informed political decisions on such niche issues. The result is that a small minority can have an outsized and disproportionate influence on securing government funding for their own vested interests.

In a sense, then, the Republican Party’s focus on cutting spending is a good one, and indeed, in the abstract, a majority of the public agrees; this forms the basis for the frequent Republican claim that most Americans support their spending cut agenda. The problem, however, is that Republicans are not behind all spending cuts; rather, they support only the cuts that fit their own ideology and objectives. They’re fiercely protective of military spending and rural air traffic controllers, for example, but are eager to cut discretionary spending on unemployment insurance and education that disproportionately affect minorities and the poor – in other words, Democratic constituencies. Similarly, the party of no tax increases quietly supported letting the payroll tax cut and various tax credits from the stimulus expire during the fiscal cliff negotiations. To be fair, Democrats are guilty too of protecting their own priorities in the budget, but they do not present themselves as the party of small government and an ideological purity. In other words, are the absolutist Republicans not so absolutist after all?

There are many things wrong with the sequester, but in one respect, at least – actually cutting spending – it does its job. The sequester shields the most important drivers of our long term debt, entitlement spending, but it does cut both discretionary and military spending. Because it cuts indiscriminately – an arbitrary percentage across all spending programs – it forces actual cuts to be made to programs that previously would never have been cut because they were Democratic priorities, or Republican ones. A single senator or a small group of representatives, for example, could block or delay legislation over a single spending program that, while inconsequential compared to the size of the whole bill, was important to that member’s constituency. Is it right that these useful cuts must be accompanied by damaging other vital government functions like education or disaster relief? Theoretically, no, but in practice, such is the price of actually enacting impactful change in today’s Washington.

Alas, even this temporary success cannot last. Already, Congress has voted to change the balance of the sequester’s cuts to spare some programs and further slash others. Some of these proposed changes are warranted and necessary to protect vital programs; many are not. If there’s one thing we learn from the budget battles of the last few years it is that cutting spending, while nice in the abstract, is in fact messy and complicated.