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The Republican War on Deficits Is a Show About Nothing

Jonathan Bernstein is a Bloomberg View columnist. He taught political science at the University of Texas at San Antonio and DePauw University and wrote A Plain Blog About Politics.
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Kevin Drum spots a great quote from Republican Senator Bob Corker, who is concerned about Republican hypocrisy: "I hope we’re not going to a place where all of the sudden, because we’re in office, we don’t think the deficit matters anymore."

I want to reassure Corker, Drum, and everyone else (and there are a lot of them) who think Republicans only care about federal budget deficits when Democrats are in office. Nope. The truth is that most Republicans -- there are some exceptions, but not many -- never care about federal budget deficits. They do talk about them strategically, so they sound hypocritical. But if you watch what they support, the truth is that most congressional Republicans and their allies flat-out reject the entire notion of budgeting. 

I've explained this before, but with budget season rolling around soon, it's time for a refresher. 

Budget deficits are, of course, the difference between revenues and spending. Call that, I don't know, the technical definition.

War-on-budgeting Republicans appear to be talking about something very different when they talk "deficits." They aren't comparing revenues to spending at all. Instead, they appear to be comparing revenues to what they consider the ideal amount of revenues, and spending on various programs to ideal spending on those programs.

If one thinks like that, then raising taxes isn't merely a bad way to cut government deficits; it actually adds to the "deficit," if we assume taxes are currently at or above ideal levels. Similarly, cutting spending on the Pentagon won't reduce the deficit if military spending is below ideal levels, it will add to the deficit by increasing the distance between current spending and proper spending. 

Is this really how most Republicans think? 

I can't get inside their heads, but it certainly seems to explain what they say and what they propose.

It explains, for example, why Republicans insisted, regardless of what the Congressional Budget Office reported, that Obamacare would increase the deficit. After all, it raised taxes away from where they "should" be, and increased spending on a social program that, they believe, government shouldn't be spending on. It also explains why, when Republicans did decide to increase spending on health care by creating Medicare Part D, they didn't find it necessary to fund it. Or why George W. Bush never requested, and Republican Congresses never attempted to pass, tax increases to pay for wars in Afghanistan and Iraq. 

Moreover, it explains why Republicans since the mid-1990s have tended to oppose "PayGo" budget procedures which require Congress to offset new spending increases and revenue decreases. 

War-on-budgeting thinking is also consistent with Republican insistence on "dynamic scoring" on taxes, the estimation technique which incorporates assumptions about the effects of cuts on the overall economy (Spoiler alert: The results wind up producing lower figures for lost revenues). True deficit hawks would prefer an, ahem, conservative method of estimating the effects of tax cuts. Better to be wrong in the direction of receiving more money than expected (and therefore lower actual federal budget deficits) than to be wrong in the direction of receiving less money, and creating larger actual federal budget deficits, than expected. If however it's the "deficit" between current tax rates and ideal tax rates that's the issue, then better to fudge the revenue estimates because proper tax rates, not the revenues they produce, is the main goal.

Even Donald Trump gives Republican lip service to reducing the deficit -- one of his big talking points during the campaign was the total government debt, although he did seem quite foggy on what that actually meant. But while his priorities aren't always what orthodox conservatives want, his overall approach of supporting higher domestic spending, higher military spending, and slashing taxes as a method for eliminating the entire debt is sort of an exaggerated version of the war on budgeting. 

Republicans still have plenty of room for internal arguments on, say, how much should be spent on health care or the military. But the deficit has nothing to do with it for them. And, yes, there are some Republicans inside and outside of Congress who really do care about actual federal government deficits, but they're the exception.  

All of this isn't about bashing Republicans; it's about understanding what they are fighting about. For example, take the Politico item Drum quoted from, which frames the intra-Republican debate as one between Pentagon spending and budget-balancing. That's the wrong way to think about it. Instead, think of it as between one side which thinks military spending is just too low -- and another group which is relatively indifferent about that but sees an opportunity to lower spending on other, unrelated things, spending categories which they would prefer to cut regardless of what happens to the military. 

The budget, for most Republicans? That has nothing to do with anything.

  1. I should be clear here: I'm not saying that I personally think deficits are bad. I tend to be in favor of them. But I do think deliberately planning deficits through a budget process is much better than not doing so. 

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author of this story:
Jonathan Bernstein at jbernstein62@bloomberg.net

To contact the editor responsible for this story:
Mike Nizza at mnizza3@bloomberg.net