Republican Pledge to Freeze Spending Poses Deep Budgetary Cuts
(Bloomberg) — U.S. House Republicans' pledge to cut $100 billion from the federal budget next year would slash spending for education, cancer research and aid to local police and firefighters.
Keeping the midterm-campaign promise would require a Republican-led Congress to cut 21 percent of the $477 billion lawmakers have earmarked for domestic discretionary spending.
"That's where you get the savings," said Representative Paul Ryan, a Wisconsin Republican who would likely be chairman of the Budget Committee if his party regained its majority in the Nov. 2 elections.
A cut of that magnitude would necessitate major reductions in spending likely to spur protests across many fronts, and Republican leaders have refused to specify any major targets before Election Day. Most of the proposals Republicans have offered so far provide minimal savings, like shaving $2 billion from the budget by capping federal salaries next year.
Still, Republicans argue that spending cuts trump tax increases as the best way to start balancing the budget in the wake of the worst recession since the Great Depression.
"To balance the budget, Congress has to get its arms around the spending here in Washington, and we have to have a healthy economy that gets Americans working again," House Republican Leader John Boehner told an audience yesterday at the American Enterprise Institute, a Washington-based group that favors smaller government. "You can't have a healthy economy if you raise taxes on those that you expect to reinvest in the economy and hire more people."
Democrats warn that the promised cuts would lead to dramatic reductions in social services across the board.
"This would have significant real-world consequences," said Representative Rob Andrews, a New Jersey Democrat on the Budget Committee. "I don't see any way there isn't a hit on college students," he said. "I don't see any way there isn't some hit on local police and fire."
Republicans have made their task even harder by taking military spending off the table along with any programs for seniors or veterans. Under the Republican plan, the budget resolution would set spending at 2008 levels, lawmakers said. While cutting the $100 billion needed to meet that pledge would force deep cuts, they have steered away from a specific plan for it.
"I'm a budgeteer," Ryan said. "I just bring down the cap."
Potential Firing Range
The Republican pledge to trim $100 billion from discretionary spending puts many programs, such as public education and cancer research, on a potential firing range: President Barack Obama has requested $73.4 billion for the Department of Education next year. That request includes $23 billion for Pell Grants to help low-income students afford college, a 32 percent increase from this year.
The money also funds special education programs, block grants to school districts and $2 billion in adult education. A 21 percent cut across the board would take about $15 billion from education. A 21 percent cut in Pell Grants would take almost $5 billion from student tuition.
The Obama administration has asked Congress for $76.4 billion for the Department of Health and Human Services next year. Almost half that — $32 billion — is for the National Institutes of Health, which includes the National Cancer Institute and other research facilities.
A 21 percent cut at the National Institutes of Health would take about $6 billion from health research.
Centers for Disease Control
The president's proposal includes $6.6 billion for the Centers for Disease Control, $5.1 billion to help low-income households pay their energy bills and $8.2 billion for meals for low-income children and other aid through the Head Start program.
In aid to local governments, Congress sets aside money for local law enforcement through Justice Assistance Grants. Police departments can use the money for equipment and personnel and any other crime-prevention programs.
Lawmakers have requested about $2 billion next year for the office that allocates that.
A 21 percent cut would take $400 million from police. Within the overall federal budget of $3.6 trillion, entitlements such as Social Security and Medicare, requirements such as payment of the national debt and discretionary spending on defense consume most of the money. Less than $500 billion is allocated for discretionary spending outside of defense.
Programs that saw big increases under Obama could be particularly vulnerable in a Republican-run House of Representatives.
National Cancer Institute
The president's request for the National Cancer Institute is up 10 percent from where it was in 2008.
Spending requests this year for Transportation and Housing and Urban Development rose by 38 percent from 2008, up $18.6 billion to $67.4 billion. Likewise, Democrats sought a 47 percent increase for diplomatic spending next year.
Representative Eric Cantor of Virginia, the No. 2 Republican in the House, set up a website called "YouCut" that encouraged Internet users to propose and vote on specific cuts.
Ideas include selling excess federal property and forbidding the administration to advertise stimulus projects, which would save "tens of millions," according to Cantor's website. Others that would produce much bigger savings, like revamping Fannie Mae and Freddie Mac, are politically difficult to enact.
Other lawmakers offer broader cuts, like Republican Arizona Representative Jeff Flake, who favors major cuts to farm subsidies through the Department of Agriculture.
Cutting some budgets can be counterproductive, said Scott Lilly, former Democratic staff director of the House Appropriations Committee. If the Internal Revenue Service is forced to cut tax collectors or agencies reduce the number of people who audit federal spending, the government could lose more revenue than it would save through budget cuts, he said.
Republicans would protect money for the military and operations in Iraq and Afghanistan. By offering explicit protections for seniors, programs like Meals on Wheels and low-income housing grants could also be off-limits.
Republicans want to revamp the spending process in other ways to give lawmakers more license to strip individual programs from individual government agencies.
Boehner offered a plan yesterday to break the spending bills up so that money for the Labor Department isn't coupled, for example, with funding for Health and Human Services.
'On Their Own Merit'
"Let them come to the floor individually, to be judged on their own merit," he said at the American Enterprise Institute.
"Members shouldn't have to vote for big increases at the Commerce Department just because they support NASA." The pledge that Boehner announced in September includes a proposal giving individual members of both parties more discretion to cut money from spending bills as they are being debated on the floor of the chamber.
The fight would play out during an expected post-election debate over curtailing the federal deficit, projected at $1.34 trillion this year. Democrats charge Republicans with hypocrisy for championing budget cuts as they push for an extension of Bush-era tax cuts for the wealthiest Americans that could cost $41.1 billion next year.
"It will have a serious impact on real people, but it won't have a serious impact on reducing the deficit," Andrews said of the Republican pledge for budget-cutting.
Obama said in June, during a meeting with other heads of state in Toronto, that he hoped "some of these folks who are hollering about deficits and debt step up because I'm calling their bluff."
Even Republicans acknowledge that spending cuts alone won't balance the budget. "Let's face it: We could zero out both the Department of Defense and zero out the Department of Education, and we'd still have a massive structural debt that we've barely made a dent in," said Representative Jeb Hensarling, a Texas Republican.