Budget Busting

U.S. election law makers note buying illegal to buy votes.  But that only applies if the candidate uses lies or his or her own money or campaign funds.  It is, as the old saw has it, perfectly legal to count votes with promises of tax payer money.  And both candidates in this campaign have freely used this loophole.  Trump has counted votes by promising to use government funds to build a wall on the country’s southern border.  Clinton has promised some voters an early spot on Medicare rolls and promised others free college, both at the tax payer’s expense.  Both promise billions of government funds to rebuild the nation’s highways, bridges, and infrastructure generally.

Those who vote in hopes of a payout will certainly face disappointment.  Budget realities make clear that neither candidate can make good on his or her promise.  Even if Clinton makes the rich pay their “fair share,” as she says or Trump root out “waste and fraud” as he says, the future promises less budget space for infrastructure spending and other such promises not more.  The simple fact is that entitlements spending — Social Security, Medicare, Medicaid, that Affordable Care Act, and unemployment insurance — will continue to eat up a greater part of federal revenue leaving less for any other government endeavor.

Already entitlements absorbs some 70 percent of all federal spending.  Defense spending, the next largest budget item, takes up about 17 percent of the total, while interest payments on outstanding government debt take up some 6.5 percent, leaving only 6.5 percent of the total for walls, free college, roads, and the like.  There simply is not enough.  What is more, the ? continue to grow automatically without annual votes in Congress and faster than either revenues or the general economy.  Because the retirement of the baby boom growth in and the increased obligations under the Affordable Care Act will accelerate the pace of such growth, future years will have even less room for the promised outlays.

Nor is there any way to fund the promises either by raising revenues or by cutting other spending programs.  Even if all billionaires and millionaires in the country were to measure up to Hillary Clinton’s notion of their “fair share,” even if Washington simply confiscated all their income, the additional funds would fail to pay for college tuition, additional Medicare, and infrastructure spending as the scale she proposes.  A crafty as some people are, an elimination of “waste and fraud” is hardly likely to fund Donald Trump’s promises.

In a competition for existing budget space, there may be some room, but it, too, is severely limited.  Defense spending cuts may yield a little, but those can only go so far.  Today’s 17 percent of total spending is already well down from earlier allocations.  Defense was 50 percent of the budget, for instance, in the 1960s.  Despite all the angst surrounding the increase during the Iraq War, it never amounted to more than 20 percent of the budget during that time.  Such defense cut, in fact, have cushioned the rest of the budget from the impact of entitlements growth.  Even if defense were to fall under 5.0 percent of the budget, it would only cushion other activities from entitlement growth for five years or so.  Meanwhile, any rise in interest rates will increase the burden of meeting interest obligations on government debt.  If the properties were to rise to the 12-14 percent demanded in the 1980s, for instance, it would more than eat up any cushioning provided by possible defense spending cuts.

Only reform of existing entitlements programs promises to free the budget to pursue other needs.  But any action to control the inexcusable rise in such spending seems unlikely to say the least.  Indeed, such measures seem beyond consideration these days.  Some years ago, Rep Paul Ryan made proposals.  Whether good, bad, or mixed, it is notable that Congress failed even to discuss them.  He has not uttered a word on reform since.  Meanwhile candidate Clinton promises to accelerate the growth of entitlements, while candidate Trump seems not to notice the need.  All the while, budget realities make liars of the candidates and almost anyone else within the beltway.

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