Worried about massive federal debt? Time to right-size the regulators

In the annals of federal bloat, a milestone is looming as noted in another post last week: 2024 interest payments on America’s $34 trillion debt are projected to surpass defense spending (Medicare outlays, too).

This predicament should serve as a wake-up call, especially as President Biden prepares to submit his fiscal year 2025 spending request to Congress in the coming days, amidst ongoing battles over unresolved 2024 domestic spending and international aid.

The federal government’s reach extends far beyond constitutionally enumerated powers. This has resulted not only in an unsustainable accumulation of debt, but also extraordinary levels of regulation. All that spending, naturally, comes with strings attached.  

While bipartisan efforts routinely lead to the creation of massive spending programs, efforts to downsize or eliminate departments and agencies are generally lacking. A notable recent exception is Sen. Eric Schmitt’s (R-MO) proposal to quash over 40 “Offices of Diversity,” many established rapidly during the Biden administration before anyone had a chance to question the process and its implications.

As I detail over at Forbes, the stage has been reached at which policymakers must begin repealing and amending outdated Administrative State statutes, abolishing bloated departments and agencies, and privatizing and apportioning to the states and civil society almost all federal functions.

Given this massive, runaway debt, a lean federal government focused on its few core constitutional responsibilities is not only feasible but essential for the long-term survival of the republic.

Proposals for departmental eliminations will face political hurdles, obviously. But both Democrats and Republicans have shown willingness to consider terminations, ranging from the likes of Rep. Thomas Massie’s (R-KY) bill to abolish the Department of Education to concerns by progressives with the National Security Agency, Drug Enforcement Administration or the Department of Homeland Security. Plenty on the right have concerns with NSA and DHS as well.  

The challenges will include political opposition, institutional inertia, and logistical complexities of what to do with programs during transition periods, and communicating the benefits of right-sizing Washington. Fortunately, substantial groundwork providing legal and budgetary insights into potential reforms has already been laid out by institutions like the Congressional Budget Office and the Congressional Research Service as well as a significant body of work on privatization.

As Congress considers federal spending priorities over the coming weeks, some more than others will urge the confrontation of perpetual deficits. These are made much worse by reflexive federal regulatory intervention in seemingly every aspect of American life.

Bipartisan efforts should insist the federal government operates within its necessary and proper limits. States, communities, households, and individuals can handle the rest.

Policymakers today have the opportunity to avoid burdening future generations with insurmountable debt and the hyper-regulation that accompanies federal consolidation by getting rid of many offices and bureaucrats. Their successors may not.

(For a rundown of various proposals to abolish agencies and downsize, see “Spiraling Debt Demands Bipartisan Mobilization to Terminate Federal Departments and Agencies,” Forbes.)