Promises, Promises, oh the Promises of Spending Cuts

Promises, Promises July 21, 2011 3:33 P.M. By J. D. Foster When is a spending cut a spending cut? When the cut is in law. Everything else is just a promise. When discretionary spending totals are cut immediately, that’s a spending cut. Such cuts are demonstrably not “pie in the sky,” so it’s fine to tally the effects over the next ten years. Similarly, when entitlement programs are altered in law, that’s a spending cut. Again, it’s perfectly appropriate to add up the resultant budgetary ramifications for a reasonable period to give some context for budgeteers. But even statutory spending caps, necessary and beneficial though they would be, are ultimately only promises to cut spending, unless they are backed by inescapable, automatic cuts if the caps are breached. Just about everything else is only a promise, and Washington breaks promises with breathtaking regularity. Congress has been hashing out a debt-ceiling increase since the start of the year. The House has acted by passing the Cut, Cap, and Balance Act. The Senate, which to date has not even passed a budget for next year, has yet to pass anything on the debt ceiling. Yet somehow it is the Republicans who are “terrorists” threatening financial terrorism, in the words of former Obama adviser Larry Summers. On the table in the Senate at the moment are two vacuous proposals, full of promises but devoid of certainty. First there’s the McConnell-Reid proposal, which does not even promise spending cuts but only infers them. Then there’s the Gang of Six quasi-plan. It’s not really a plan because, despite months of work, the plan has so few details one cannot even reliably guess at the net tax hike it would impose. The Gang certainly can’t tell you. Moreover, according to one of its authors, Sen. Dick Durbin (D., Ill.), they have no legislative language. Apparently, then, the real plan is to raise the debt ceiling and promise to take up the Gang’s plan whenever it’s ready. And what is that promised plan? To enact legislation that would promise to tell certain congressional committees to look for more budgetary savings. And the committees would, by implication, promise to comply — a promise of a promise of a promise. For anyone who is serious about the soaring deficits and the threat they pose to the nation’s future, the best possible response was offered by the great Dionne Warwick: Promises, promises, I’m all through with promises, promises now, I don’t know how I got the nerve to walk out, If I shout, remember, I feel free, Now I can look at myself and be proud, I’m laughing out loud. Enjoy, and take heart. — J. D. Foster is the Heritage Foundation’s Norman B. Ture senior fellow in the economics of fiscal policy.