Posted by
Buster Foghorn on Sunday, July 31, 2011 4:39:31 PM
Changing the budget process to a rational one that Americans can understand will immediately benefit everyone.
What happens with the debt ceiling debate? Will the government default? Will President Obama get both his $2.5 trillion spending increase and an extension past the next election? Is the current House Republican battle royal over the Boehner plan worth the candle?
The game of poker was in the news a few weeks ago when President Obama reportedly told House Majority Leader Eric Cantor: “Eric, don’t call my bluff!”
Speaking of poker, I was about 9 years old when I first started playing with neighborhood boys. We sat on my folks’ carpet floor, a carpet covered with pennies and played for hours. Years later during college summers, I sat around a table with co-workers and we played for $20 limit bets. In one game, car keys went into the pot. It was a big difference in risk, but the potential reward was there.
Mr. Boehner, like a modern Sisyphus rolling his rock to the top of the mountain without making progress, is battling for pennies. Instead of haggling for ephemeral spending cuts over ten years—an impossible political mountain to climb—House Speaker John Boehner should change the stakes in the debt ceiling negotiations by pushing for a meaningful long term change in the budgeting process. He should push for structural budget reform: forget fighting over cuts in the rate of growth under the 1974 Baseline Budget rules, rules that assume government is going in the right direction and future increases are built-in. Under those rules even the Paul Ryan budget added trillions of new spending to the nation’s debt. Instead, he should promise to advance a clean debt-ceiling bill without any future spending cuts from the current budget in return for future budgets based on “zero based budgeting.” “Zero based budgeting” as explained in Wikipedia, “requires that all spending must be re-justified each year or it will be eliminated from the budget regardless of previous spending levels.”
After all, how many Americans in financial trouble assume that next year they can spend an additional 7%, or so, just because the calendar turned to a new year? Families and businesses know that if they are in debt and current out-go exceeds income, they can’t spend more next year than they did this year. It is time for the political class to follow the same rules as any American family watching their pennies.
Democrats will scream that this is draconian, that certain programs will have new expenses and need funding. The answer is that funding is available; the agency just needs to come before Congressional budget committees and make a case for additional funds. Budget committees can then scrub the agencies performance, their efficiency reform efforts, their success in prosecuting fraud cases or fighting waste and abuse. If the agency has performed satisfactorily in all these areas and the request is legitimate and other funds are not available within the agency, then Congress can grant the request. The difference is the grant for new spending will be a conscious, knowing decision and not a mindless increase without Congressional oversight and supervision.
If Mr. Boehner can change the structural budget rules under which the game is played that is worth more than the pot with the car keys; it is like winning the title deed in the pot for the gold mine. Changing the budget process to a rational one that Americans can understand during these days of rising debt will immediately benefit everyone by requiring that the Congressional Budget Office reports new budget proposal in plain English and not in some Washington code.
Perhaps there are some who don’t think the current budgeting process can be that bad? Just how much of a problem is the current baseline budget requirement? Writing about baseline budgeting and the current Washington practice of increasing spending while calling it a cut, Arthur Herman (in Versailles on the Potomac) recently said:
This has created a system which today’s Congressional Budget Office would score a freeze on all government spending as a $9 trillion cut, even though there’s no reduction in spending at all.
The root of the dilemma we face’ says Herman “is not political or fiscal, but moral. Until Congress overturns an accounting system that deliberately distorts empirical reality, we will never escape the corruption it entails — or the catastrophe that’s coming.
After all, if Mr. Boehner is going to play poker with President Obama and “call his bluff” then the stakes should be worthy of the risk.