Yesterday, Mick Mulvaney, director of the Office of Management and Budget, announced the largest budget cuts to non-defense discretionary agencies since the Reagan administration. Rather than cheering this bold move — especially in light of the concern about Trump not being a fiscal conservative — establishment Republicans in Congress are grousing at this common sense budget blueprint.
Many conservatives were concerned that given some of Trump’s past statements on spending, he’d demand a full repeal of the sequestration cuts. Those of us who had doubts on fiscal issues should breathe a sigh of relief thanks to the good work of Mick Mulvaney, Russ Vought, John Gray (former CR writer!), and the other good staff at OMB. They got the president to sign off on a budget blueprint that will increase defense spending by $54 billion but still maintain the overall level of sequestration by cutting $54 billion from nondefense discretionary spending. Thus, we can have our cake and eat it to.
The breakdown of the budget is as follows: under current law, budget authority for FY 2018 is capped at $1.064 trillion — with $549 billion allocated for defense programs and $515.4 billion for non-defense spending. Under Trump’s budget proposal, defense spending will rise to $603 billion while non-defense spending will fall to $462 billion.
While the overall level of discretionary spending will not decrease (because of the much-needed plus-up in defense spending), a 10 percent cut in non-defense bureaucracies is very important as a matter of policy. The problem with discretionary spending is not so much the budgetary effects. After all, 70 percent of the budget is comprised of mandatory spending. It’s that so many of these agencies harm our economy with regulations or social engineering interventions.
By starving the beast, OMB can ensure that these agencies are limited to their core functions. And while the specific allocations by department will not be announced until March 16, it is quite evident that it is the least important agencies (the one’s most admired by the Left) that will incur the brunt of the budget cuts.
Yet, much like with Trump’s immigration policies, very few Republicans are publicly championing the budget blueprint (outside of Mulvaney’s former colleagues in the Freedom Caucus). Instead, a bunch of them are echoing Democrat talking points and complaining about deep cuts to the officious bureaucracies. Others are complaining that the increase in defense spending wasn’t enough.
“They’re not going to take anything out of Homeland Security. They’re not going to take anything out of Veterans Affairs. So now we’re down to just the others,” Simpson said, referring to nine other annual spending bills that include mostly nondefense appropriations. “You’re going to cut $54 billion out of that?”
“I don’t think you could pass any of the bills,” he added. “There’s a lot of members that have a lot of interest in a lot of these programs. There’s more to our government than just defense.”
Well, that’s exactly the point. Outside of defense, most of these functions should be left to the states or shouldn’t exist at all. Naturally, departments such as Education, HUD, Energy, Commerce, and Labor should be scaled back.
In some respect, I give Simpson credit for being honest. He is correct in assuming that this budget will have a difficult time passing Congress because many Republicans are not fiscally conservative (and we already know they are certainly not socially conservative). They have no intention of balancing the budget, shrinking the scope and reach of the federal government, or fostering federalism and individual responsibility.
Moreover, if these members can’t handle $54 billion in cuts to the deep bureaucracies, there is no way they will develop a backbone to address the other 70 percent of the budget, which is comprised of “mandatory” welfare and entitlement programs.
With mandatory spending projected to cost $34 trillion over the next 10 years and deficits estimated to rise by $7.8 trillion, it’s kind of sad for the “more conservative” party to bristle at $54 billion in domestic cuts — primarily to programs that shouldn’t exist — to offset a universally supported increase in military spending.
It’s also a sad testament to the state of this party that even a lifelong Democrat — who is regarded as fiscally liberal on many issues — is to the right of Republican committee chairmen on spending. Many conservatives worried that Trump’s presidency would spell the end of fiscal conservatism, but unfortunately the party establishment has already done the job for him. At least Trump is allowing conservatives at OMB to work their magic.
Trump should be applauded for allowing his OMB to take this bold, first step. Now he must realize the severity of our budget disaster from the fact that even after these cuts to discretionary spending are actualized, the projected mandatory spending will bankrupt this nation.
This is why he should support the movement to devolve functions like transportation and education to the states, rather than promote another $1 trillion in inefficient transportation spending at a federal level.
This is why Obamacare must be repealed — in FULL.
And although he is not a fan of reforming Medicare and Social Security, the bleak budget outlook will hopefully make him think twice before supporting Ivankacare.
While Trump is banking on economic growth to help reduce the deficit, he must remember that the massive misallocation in resources reflected in the debt weighs down economic growth, which is why we have not experienced a year of three percent growth in 11 years or a year of five percent growth since Reagan.
Which is why he must tell Republicans in Congress to get with the program.
Editor’s note: This article now includes a link to TheHill.com article in the second paragraph.
Daniel Horowitz is a senior editor of Conservative Review. Follow him on Twitter @RMConservative.