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America’s Annual Attention Deficit About the Annual Budget Deficit

Not so very long ago, American conservatives used to fret about the swelling federal debt. Back when the debt was swelling at the rate of a trillion dollars a year under President Barack Obama it was conservatism’s most pressing issue, and led to the Republican party regaining control of both chambers of Congress, which successfully cut the annual budget deficits to a mere half-trlllion or so. With the annual budget deficits back up to a trillion bucks under President Donald Trump, however, only the most old-fashioned sorts of conservative are worried about it.
Back during his improbable presidential campaign Trump made some wildly extravagant promises about paying off the entire national debt in four years, but he also made some similarly wild and extravagant promises about huge tax cuts and increased military spending and an expensive infrastructure bill and a big beautiful wall along the entire southern border and allowing no changes to such popular programs as Medicare. At other times the self-proclaimed “King of Debt” also talked about racking up even more debt because of the temporarily low interest rates, and rattled international markets by openly speculating on the sort of defaults and haircuts that he’d relied on during his failed career as a casino mogul, but for some reason a plurality of Rebublican primary voters trusted Trump’s assurances it would all somehow work out.
Now Trump is once again talking about cutting deficits, but he’s finding it hard to do given all the other promises he’s made. The sizable tax cut Trump signed into law might yet fuel enough economic growth to cut into the deficits, but for now and the foreseeable future it’s lowering federal revenues as spending go up. Trump got the record defense spending that he wanted, and although he’s now reportedly open to cutting it slightly he seems to have some ill-informed ideas about military technology and still wants an expensive military parade and has troops idly awaiting an epic clash with a few thousand unarmed asylum-seekers at the southern border.
So far as we can tell from Trump’s vague explanations his infrastructure plan relies largely on private investment that the private investors surely expect to be compensated for one way or another, but it’s still expensive, and unless he can get it passed during the lame duck sessions it’s unlikely the incoming Democratic majority in the House of Representatives will make it happen. The outgoing Republican majority in the House was only willing to cough up a measly couple of billion dollars for Trump’s big beautiful border wall, and the incoming Democratic majority is unlikely to be as generous as that, and Trump is threatening a government shutdown over it even as he resumes talking about cutting the deficit.
Trump is still holding to his campaign promises about allowing no changes to Medicare or Social Security, too, which makes it pretty much impossible to put a noticeable dent in the budget deficits. Everything in the federal budget other than the military and servicing the existing federal debt is relatively paltry compared to those programs, and even if Trump somehow were able to eliminate all the undeniable waste and fraud it wouldn’t compare to a month’s spending on what Trump has declared sacrosanct, and even the stingiest conservative must concede that there are certain expensive services a government can only provide.
The expert and apolitical trustees of the Medicare and Social Security funds are predicting both programs will go belly up right around the time we’re eligible for their benefits, but for now they’re both so popular that it would take a pretty courageous politician to dare suggest even the mild reforms that might forestall the disaster. Once upon a time such Republican politicians as House Speaker Paul Ryan dared suggest paying current beneficiaries according to the deal they’d signed on to, and a deal to those currently paying in that the government could realistically hope to make good on, but Ryan’s leaving public life after two years of signing off on trillion dollar deficits, and we don’t expect presumptive House Speaker Nancy Pelosi to suggest such essential reforms.
Nobody likes taxes and everyone likes their government checks and services, and most Americans are misinformed about the relatively paltry sums America is spending on foreign aid and abortion advice and subsidies for the arts and other resented-by-Republicans programs, and the administration of justice and maintenance of federal highways and other popular projects are more expensive than most Americans realize, so solving the political problem of deficits and debts is far more complicated than Trump made it sound back during the campaign. Despite his very stable genius and unaccountable knowledge of military technology Trump still doesn’t seem to have the answer, even though it’s long been apparent to the more old-fashioned sorts of conservatives, and he’s not the sort to tell his supporters anything they don’t want to hear.
Obama still deserves blame for the trillion dollar deficits that he needlessly racked up even during the worst financial crisis since the Great Depression, and we’re sure Trump will continue to blame him, but Trump will also surely find someone to blame for the trillion dollar deficits he’s racked up in what he boasts is the greatest American economy ever, so we’re not hopeful the problem will be solved in time to pay for our golden years. In the meantime the government will be paying a few trifling millions of dollars a month to Trump’s golf resorts, but the Democrats in the House will probably tell Trump to keep his extravagant campaign promise to have Mexico pay for that big beautiful border wall and let him take the hit in the polls if he follows through on his threat of a government shutdown, that slender Republican majority in the Senate and Trump’s veto power will probably forestall the Democrats most expensive ambitions, so there’s a chance that at least America will head to the inevitable fiscal cliff at a slightly slower speed.

— Bud Norman

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Who’s Afraid of a Government Shutdown?

There’s been talk lately that the federal government might shut down, due to Obamacare or the debt ceiling or a convoluted combination of the two, and some people seem worried about it. Some people will always worry about such things, we suppose, but it’s hard to see what all the fuss is about.
The government has shut down too many times to keep track of, including a sizeable number of federal holidays and almost every weekend of the year, and if not for all the furor in the press it would almost always have gone unnoticed. All the stories invariably involve families that are disappointed to find a national park closed while on their vacations, which seems a minor inconvenience at a time when all the kids should be in school, or horror stories about old folks starving in the streets for want of a Social Security check, which never seems to actually occur, and most readers remain unconvinced that there’s a real problem. The stock markets typically take a slight temporary dive, although that might be for fear the federal government will eventually return to work, but otherwise the economy stumbles along in its usual way. All the cops and firemen and other useful public servants are still on the job, drawing paychecks from state and local governments that some how manage to stay in business throughout the year, and all of the “nonessential” personnel who are furloughed for the duration prove as nonessential as advertised.
President Barack Obama is warning that a government shutdown will mean the nation’s bills go unpaid and America will be a “deadbeat” and a “banana republic,” with economic catastrophe following from the international doubt about the full faith and credit of the country, but we suspect this is only because the old saws about national park closings and unsent Social Security checks have lost their scariness. He also talks about those crazy spendthrift Republicans have been running up a huge tab against his frugal counsel and now want to “run out on the bill,” as if he hasn’t fought against their effort to restrain spending, and has offered the preposterous claim that raising the debt ceiling doesn’t mean the country will go further into debt, making the president sound rather desperate for something to say. Thus far even the supposedly anarchist wing of the Republican party has been willing to pay for all the government anyone might want except for Obamacare, and they’ll surely cave on that one sensible demand before they allow the government to default on its obligations to bondholders, so the economic catastrophe will have to await the all-too-soon date when the government debt has grown so large that the bondholders stop buying and the Fed is forced to concede that it can’t keep printing up money to pay them.
The people who are most worried about a government shutdown seem to be politicians worried mostly about who get the blame if anything noticeably bad actually does happen. Many Republicans, especially the ones with a professional stake in the party’s political fortunes, are understandably concerned that the traditional media outrage will once again bring the electorate’s wrath down upon in the upcoming mid-term elections and hand complete political control to Democratic party hell-bent on the same sort of mischief they inflicted on the country in the first two years of Obama’s reign. The Democrats, on the other hand, fear a government shutdown because it once again might have no noticeable effect and thus remind the country that it really doesn’t need to pay them so much money to run the meddlesome behemoth.
With neither party gaining any advantage from a prolonged government shutdown, it’s not likely to happen. Preventing it will mean Obamacare and another trillion or so of federal debt, both of which are far more disastrous than a government shutdown, but at least the full faith and credit of the country will be restored and banana republic status delayed for another year or so. That should get us past the mid-terms, and that’s all that anybody is really worried about.

— Bud Norman

Budget Fuss

President Barack Obama at last presented his budget proposal on Wednesday, two months after the legally mandated deadline and late enough for the press to declare it “long-awaited,” and it proves an interesting document. It’s probably irrelevant, as none of Obama’s previous budget proposals have ever gained so much as single vote in Congress and this one looks likely to fare even worse, but it’s interesting nonetheless.
In its totality the budget proposal is typical of all of Obama’s past political efforts, with big tax hikes imposed mainly on the wealthy and some cuts taken from defense while increasing spending elsewhere, with no end to the massive amounts of the red ink in sight, but buried deep within are a few ideas that are pleasantly surprising, such as asking federal employees to contribute more to their pensions and health care as well as a sort of jargon-laden acknowledgement that some sort of entitlement reform is ultimately necessary. None of it comes close enough to fixing the nation’s soon-to-be-calamitous fiscal condition to win any the vote of any real Republican, but it’s more than enough than to infuriate the more noisome elements of Obama’s Democratic base, and sufficient for the president’s more ardent admirers in the press to deem it part of his “charm offense” and a move toward an admirably more pragmatic and less political approach.
Those pressmen are probably over-doing it a bit, as Obama is still insistent on tax hikes and deficit spending that are calculatedly unacceptable to the Republicans, and his tone when announcing the plan was still full of partisan punchiness. After hilariously arguing that his massive tax hikes are “a fiscally responsible blueprint for middle-class jobs and growth,” Obama went on to blame his opposition for the supposed catastrophes of the “sequester” budgets cuts that were originally suggested by his staff. He even kept a straight face as he claimed that the currently robust recovery will continue “as long as Washington doesn’t get in the way.” Any real Republican believes that Obama’s tax hikes and deficit spending on ever-expanding regulations are precisely what’s getting in the way of a recovery more robust than the current 0.4 percent growth rate, of course, but Obama clearly remains uninterested in such crazy talk.
Such rhetorical red meat won’t satisfy the true believers in Obama’s party, however, given the heresies he has laid out in the budget proposal. Asking government workers to pay toward their pensions and health care at something approaching the rate of a private sector employee made Wisconsin Gov. Scott Walker and New Jersey Gov. Chris Christie the left’s most vilified figures in public life, and any attempt to prevent the imminent demise of any entitlement program is somehow regarded as a blasphemy against Franklin Roosevelt. Even such “baby steps,” as the venerable right-wing National Review approvingly dubs it, are enough to create a rift within his party and opening for the Republicans.
Obama has merely proposed an accounting change in the way Social Security benefits are dispersed, dryly dubbed “chained CPI,” but as the ads are already saying on local talk radio that translates to Social Security which will inevitably prove unpopular not only with staunch leftists but also with many older and more-prone-to-vote Americans. Opportunistic Republicans can run on their outraged opposition to throwing the old folks out on the street in the next election cycle, neatly flipping a traditional Democratic theme, while more principled Republicans can run on Rep. Paul Ryan’s House-approved plan that maintains the status quo for the over-55 crowd while offering the next generations more free-market options as an appealing replacement to the entitlement systems, and in either case they could do well.
If Obama is being the shrewd politician that the press portrays, it is hard to see how his plan will benefit his party. Perhaps he’s reacting responsibly to the economic and fiscal realities that he confronts, in his own half-hearted and characteristically partisan and ideological way, but c’mon.

— Bud Norman