Tags: Barack Obama | Economic- Crisis | Obama Budget | Morris | discretionary | spending | deficit

Discretionary Spending Key to Cutting Deficit

Tuesday, 15 Feb 2011 01:06 PM

The Obama administration and its acolytes on the Bowles-Simpson deficit reduction commission are propagating the myth that it is Social Security and Medicare that are driving the deficit over $1.5 trillion. Discretionary spending, they plead, is but a tiny part of the budget, not much worth fooling with.

The reality, as we explain in "Revolt!" — our new book due out on March 1 — is that this formulation is a myth! The fact is that this deficit has been caused by a rapid runup in discretionary, non-defense spending and in welfare entitlements like Medicaid and food stamps. The key to cutting spending and slashing the deficit is not to focus on Social Security or Medicare, but on the real culprits — discretionary spending and welfare entitlements.

Obama and the Democrats are playing a game (the same one they played in the 1990s before Bill Clinton called their bluff). By pretending that the most politically popular programs — Social Security and Medicare — cause the deficit, they insulate the whole array of less popular government programs from cuts. They hide appropriations for EPA, PBS, highway construction, the Department of Education, and the like behind Social Security and Medicare reform.

But it is the core spending on the bureaucracy itself that is driving this deficit, increasing by $200 billion in the two Obama years. And it is Medicaid and food stamps and other welfare entitlements, up by $140 billion, that are also culprits.

In the past two years, we have added 80,000 federal workers, 11 million food stamp recipients, and $50 billion in Medicaid costs under Obama.

When baby boomers start to retire in greater numbers later in the decade, we will need to focus on Social Security and Medicare, but now lets cut the core federal discretionary and welfare spending that is at the root of our burgeoning deficit.

In "Revolt!," we list the very specific budget cuts in discretionary spending that make the most sense. Here are a few of them:
  • Save $30 billion a year by freezing new highway construction for three years. Keep spending what is needed for maintenance and safety.
  • Save $4 billion by making passengers and airlines pay for airport improvements rather than using tax money.
  • Save $4 billion a year by cutting climate research and energy loan guarantees.
  • Save $500 million a year by rolling back the cost of Congress to 2008 levels.
  • Save $12 billion a year by eliminating Obama’s pork barrel programs — National Infrastructure Innovation and Finance Fund and the Build America bonds.
  • Save $3 billion a year by a 20 percent cut in diplomatic missions and foreign service staff.
  • Save $12 billion a year by cutting farm subsidies to the largest 10 percent of U.S. farms.
  • Save $4 billion by tying federal pension COLAs to price inflation, not wage inflation.
  • Save $7 billion a year by eliminating Obama’s proposed increases in the Department of Education.
  • Save $1 billion a year by eliminating the Endowment for the Arts and the Humanities and ending PBS subsidies.
  • Save $5 billion a year by making no new Section 8 rent subsidy commitments.
"Revolt!" itemizes many other proposed cuts. It is not hard to bring the deficit down to less than 4 percent of GDP by 2014 by cutting discretionary and welfare entitlement spending.

Its just that liberals don’t want to do it.

© Dick Morris & Eileen McGann

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