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February 14, 2012

Post of the Day

Bruce McQuain, on why the federal government continues to grow:

We often hear the Democrats cited as the reason we’re in this mess today, but that’s a cop out. The right in the guise of the Republican party are just as guilty as the Democrats. In fact, I’d argue they’re more guilty. The reason we’re in this mess today is because over the years the Republicans have accommodated the Democrats by compromising their principles.

The most recent examples are Medicare Part D and No Child Left Behind – two huge government programs one of which put a new entitlement in place and the other which increased federal control of education (at an equally huge cost).

Here’s a quote from the Heritage Foundation report I’d like you to focus on:

The last decade has seen a significant expansion of benefits provided by Medicare, including the new prescription drug benefit created under Medicare Part D. From 2004 to 2010, Part D was responsible for $214 billion in federal spending.[26] Though the role of competition in its defined-contribution model has caused estimates of its 10-year cost to drop 41 percent from initial CMS projections, the program has added substantially to health care entitlement spending.[27] Additionally, the publicly funded Part D program has crowded out private coverage alternatives. Research by economists Gary Engelhardt and Jonathan Gruber suggests that before Medicare Part D was enacted, 75 percent of seniors currently receiving public coverage held private drug coverage. Part D also increased average spending on prescription drugs by seniors, an expense that is funded by an increase in public spending of 184 percent, accompanied by a reduction in seniors’ out-of-pocket spending of 39 percent and private insurance plan spending of 37 percent.[28]

First, remember that we’re talking about the “richest” demographic in our country when we talk about seniors. Yes, everyone knows that, like every demographic, there are exceptions, but for the most part, seniors are pretty well set.

Now, notice the effect that this program has had. It has “added substantially to health care entitlement spending” It has “crowded out private coverage alternatives”. And it has “increased the average spending on prescription drugs by seniors … funded by an increase in public spending of 184%”.

So A) it increased public spending in an ear in which we can’t afford increased public spending, B) it basically destroyed a market that was apparently working prior to its implementation C) the taxpayer is on the hook for more spending as seniors, who now pay less out of pocket, shift the cost to them.

This wasn’t a program supported just by the left, folks. This was negotiated, passed and signed into law with the blessing of a Republican President.

THIS is why we’re in the mess we’re in. THIS is where the precedent for ObamaCare was set.

As much as the other candidates want to hit Mitt Romney on RomneyCare (and they should), one should remember that Rick Santorum voted for Part D (although he now says that was a “mistake”) and Newt Gingrich lobbied for it.

I agree with Bruce but with an important caveat: Republicans haven't supported these programs for no reason.

The single biggest delusion in conservative circles (aside from the remarkable assertion that Rick Santorum is the conservative alternative to Mitt Romney) is that these things happen in a vacuum.

They don't, and that problem won't go away simply because we don't like thinking about it. This is why I keep returning to the question no one wants to address: what do you expect a Republican President to do about the deficit?

This is what Congress looks like now, and we have gridlock. If your response involves any scenario that would only be possible if Republicans control both houses of Congress and the White House, allow me to remind you that every two years, all 435 seats in the House are up for vote. And every two years, about one third of Senate seats are up for vote.

At some point, we have to stop and examine the assumptions that are guiding our political choices. Even if we controlled both houses of Congress, the notion that a Republican president could rely on the votes of every Republican representative and senator is, I think, wildly optimistic.

Some members of Congress face re-election contests in progressive or progressive-leaning states and districts, and the will of their constituents is not something they are likely to disregard.

I understand the yearning for ideological purity, but over the years conservatives have rightly criticized progressives for utopian plans that don't survive contact with a real world that is anything but utopian in nature.

As tempting as it is to blame Congress, or the President, or the system, if we are honest about what is driving the increasing size and power of the federal government we cannot reasonably escape the conclusion that the root of the problem is not Washington. It's Main Street.

That's disturbing, because even advocates of small government want a top down solution. Stop and think about that one for a moment: we want a leader who will tell the American people they can't have all the goodies they keep voting for. We want a paternalistic government to put its foot down and tell us, "No".

Question for the day: is that really limited government? Or is it possible we've bought into the very kind of thinking we claim to reject?

Posted by Cassandra at February 14, 2012 06:13 AM

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McQuain writes: "The reason we’re in this mess today is because over the years the Republicans have accommodated the Democrats by compromising their principles."

You write: "I agree with Bruce but with an important caveat: Republicans haven't supported these programs for no reason."

Well, fair enough, but nobody thought they had done it for no reason. We even understand the reasons.

That doesn't change the fact that these kind of entitlement programs -- leaving aside the question of whether they are constitutional, let alone whether they are desirable -- these kind of programs simply can't continue as currently structured.

Asking for the government to recognize that fact isn't asking for paternalism. It's asking for rationality. Just post the honest numbers -- including, as they usually don't, promises made regarding Federal pensions. The figure comes to around $100 trillion.

That means that every American, man, woman, and child, needs to pony up about $333,333.33 in taxes -- if we entirely stop all government spending today, and spend no more on anything beyond what we have already promised to spend.

Clearly that kind of money does not exist. If it is a function of the Congress to craft a budget, surely we are not wrong to ask that they craft one that fits the reality of our situation.

So maybe you're right, and cutting spending is beyond the realm of political reality for now, because the American people won't support it. Nevertheless, at least we could have some candidates who were uncompromising about telling the truth of what the numbers look like.

Posted by: Grim at February 14, 2012 11:18 AM

I think certain people have bought into it because if they don't they have to admit to themselves "You are not voting your way out of this" which probably falls into those dangerous ideas you were talking about earlier. No one is willing to start shooting their neighbors and family (which is exactly what would be required). And so, Greece is looking more and more inevitable. We will spend ourselves in penury. Only when there is literally no money left will spending be controlled.

Things will be *bad*. It will get worse.[/understatement].

Posted by: Yu-Ain Gonnano at February 14, 2012 11:26 AM

...maybe you're right, and cutting spending is beyond the realm of political reality for now, because the American people won't support it. Nevertheless, at least we could have some candidates who were uncompromising about telling the truth of what the numbers look like.

But what is the truth, Grim? Every day I hear Republicans talking about how this is all the Dems' fault. But that - literally - is not true.

It's red meat. A while back you asked why you should trust a politician who says different things to different audiences? Right now, during the primaries, the audience wants one thing.

During the national election, though, the electorate won't just include Republicans. I agree that we need to discuss the numbers honestly. That gets folks to the point of agreeing that spending needs to be cut.

But they don't agree on WHICH spending is to be cut.

IOW, I'm very much afraid that Yu-Ain has the right of it.

Posted by: Cassandra at February 14, 2012 11:36 AM

If you can get them to agree that spending needs to be cut, and on the scale that it needs to be cut, the question of where to cut solves itself. Cut the entire government of the United States except for pensions (including Social Security), health care (including Medicare and Medicaid), welfare, defense, and education: you will have cut only 26% of the budget.

The cuts thus must come from those programs that make up the 74%. Defense is only 14%, so even if you disband the army and Marines, mothball the navy, and so forth, you've still got 60% of the Federal budget tied up in pensions, health care, education, and welfare.

We may have to argue about how deeply we cut the 26% "rest of government," or the 14% "defense." Even if we cut both as deeply as we can, though, the meat of the cuts will have to come out of the left's agenda.

If that can't be done, then let the collapse and ensuing civil war come quickly; I'd rather get it over with while it'll be me and not my son who is of the right age to fight it.

Posted by: Grim at February 14, 2012 12:28 PM

Civil war won't come. As I said, no one is willing to start shooting their neighbors and family.

It'll be riots and looting: New Orleans after Katrina writ large. Again, see Greece. The difference is that the Greeks seem to be blaming external malefactors not their fellow citizens.

Posted by: Yu-Ain Gonnano at February 14, 2012 01:09 PM

We want a paternalistic government to put its foot down and tell us, "No"...is that really limited government?

We hire a government to speak for us and to do things we cannot do individually. If we did not need government for these purposes, we would form one, anyway, if we did, out of laziness. A government that...governs...out of our laziness will indeed be paternalistic, before it becomes despotic.

A government formed for the first reason, though, will, if it's keeping its part of the employment agreement, tell us that the assignment we've given it is impracticable/impossible when it seems that that is so, including saying, "No." "No" from a government isn't necessarily paternalistic--it depends on the circumstance.

If we don't like what our employee does or says, we certainly can, and should, fire him at the next election. But until then, our employee has his own obligation to say yes or no depending on its understanding of the practicalities involved. And that threat of firing--if it's believable--will necessarily give pause to simply blowing with the electoral winds.

It takes principled men and women to tell us "No" when they think that's appropriate, and not tell us "Yes," or the other side "No" because that's politically expedient. Principled men and women can compromise on mechanics of implementation, and they can compromise where their principles overlap. They cannot compromise on their principles, or they have no principles. This, in itself, argues for small government, if only to keep physically small the numbers of people in conflict.

To achieve that, it's going to take one party (my preference is the Tea Party-fueled Republican party) in control of both houses of Congress and of the White House. That's no guarantee of success, but it creates a precondition for that success--just as Obama showed when--however much everyone decried his mechanics--he got Obamacare and Dodd-Frank rammed through. True enough, the next election and round of firings is only two years away, but here, too, Obama showed a way: move hard and fast.

The demonstrated success of the shrinkages will support keeping them in place. We have an excellent chance of seeing that demonstrated in Wisconsin this August-ish. The demonstrated failures of the other path (including the outcomes of Obama's political blitz) also will support maintaining conservative successes.

But our guys will, indeed, have to move fast and hard. Just as the Republican House (with Tea Party freshmen knives pricking at backs to keep the advance going) has already done with actual budgets passed, actual reform ideas passed, if not brought out in concrete terms for discussion.

Eric Hines

Posted by: E Hines at February 14, 2012 01:10 PM