The budget deficit for Fiscal Year 2011 is projected to be a staggering $1.645 trillion, out of a budget of $3.819 trillion. The Republican-controlled House of Representatives voted to cut $61 billion — about 2 percent — out of this year’s budget to shrink the deficit. Remarkably, to Senate Democrats, this tiny cut is too much.
The Washington Examiner’s Susan Ferrechio reported on Wednesday that “Senate Democrats proposed a short-term budget on Tuesday that would keep federal spending at current levels, setting up a showdown with House Republicans that increases the possibility of a government shutdown as the GOP presses ahead with plans for steep budget cuts.” (On Friday, though, they showed a potential willingness to compromise by cutting a smaller amount: those few “programs that President Obama has already marked for elimination.”)
Although the House cuts were small, they managed to eliminate some waste. As the Washington Post noted, the House “left no sacred cows,” and cut “pet projects” and pork-barrel spending long supported by lawmakers, like the “development of an alternate engine for the F-35 Joint Strike Fighter,” which the Pentagon has repeatedly said it doesn’t need.
The House Republicans also cut ethanol subsidies, which have fueled world hunger in poor countries, harmed the environment, and arguably helped spawn an increase in Islamic extremism in places like Afghanistan and Egypt. As the Washington Post has noted, ethanol subsidies have contributed to food riots in the Third World and rising food prices at home. In the U.S., “The federal government’s love affair with ethanol subsidies drove up food prices, depleted plains-state aquifers and subsidized the destruction of water fowl habitat.”
If anything, the House Republicans should have gone further in trimming spending at the Pentagon, the Education Department (where spending has exploded), and on taxpayer-subsidized, union-backed, rail boondoggles that few people ride. They could also eliminate costly “green-jobs” programs that wipe out jobs (like a billion-dollar Obama administration boondoggle referred to as the “Biomass Blunder” by a leading environmental law professor), or effectively send them overseas.
While blocking budget cuts on Capitol Hill, Obama and the Democratic National Committee have intervened in Wisconsin to help government-employee unions fight budget cuts there, even though Wisconsin government employees are paid much better than taxpayers. As the Washington Examiner’s Michael Barone notes:
Everyone has priorities. During the past week Barack Obama has found no time to condemn the attacks that Libyan dictator Moammar Gadhafi has launched on the Libyan people. But he did find time to be interviewed by a Wisconsin television station and weigh in on the dispute between Republican Gov. Scott Walker and the state’s public employee unions. Walker was staging ‘an assault on unions,’ he said, and added that ‘public employee unions make enormous contributions to our states and our citizens.’ Enormous contributions, yes — to the Democratic Party and the Obama campaign. Unions, most of whose members are public employees, gave Democrats some $400 million in the 2008 election cycle. The American Federation of State, County and Municipal Employees, the biggest public employee union, gave Democrats $90 million in the 2010 cycle. Follow the money, Washington reporters like to say. The money in this case comes from taxpayers, present and future, who are the source of every penny of dues paid to public employee unions, who in turn spend much of that money on politics, almost all of it for Democrats. In effect, public employee unions are a mechanism by which every taxpayer is forced to fund the Democratic Party.
Health policy analyst Michael Cannon argues that that states should reduce their looming budget deficits by not implementing costly provisions of Obamacare. While courts have divided over its constitutionality, two dozen states obtained a ruling in Florida that the health care law is unconstitutional. That court ruling should be binding as to those states, freeing them from the costly obligation to implement Obamacare. In my amicus brief in the Florida case, I explained how Obamacare places huge, uncertain and unpredictable financial burdens on state governments through its Medicaid expansion provisions. Obamacare will also harm doctors, patients, employers, consumers, the health care system and the insurance market.