Pinkerton: The Federal Budget and Self-Defeating Virtue-Signaling

When Politics Affect Real People, the Fun and Games Aren’t Fun 

For those who think that politics is mostly sound and fury, signifying nothing, well, the annual federal budget process might help to confirm their thinking. There is, indeed, something “Seinfeldian”—in the spirit of the old Seinfeld sitcom, which was “about nothing”—in the way Washington, DC, goes about its budgeting process. Of course, that doesn’t mean that the budget shenanigans are funny; they can, in fact, be politically costly.  

Starting on February 10, when the White House Office of Management and Budget (OMB) released its fiscal year 2021 document, everyone in Washington, DC, struck the pose of a fiscal expert, either pointing with pride to some budget item, or else viewing it with alarm.  

Of course, as we shall see, most of these expressions were just empty gestures, because the budget itself is mostly symbolic; the real decisions about who gets what will be made on Capitol Hill, months from now. As they say, the president proposes, and the Congress disposes.  

In other words, what’s happening now—as reporters and interest groups comb through the fine print of the budget, looking for “their” number—is a kind of ritualistic virtue-signaling, in which both proponents and opponents of the Trump budget seek to position themselves as being on the side of the angels. At least, their angels. 

Yet still, something real is happening: Underneath all the punditing, posturing, and press-releasing, the federal government really will spend roughly $5 trillion next year—and that’s not nothing. 

Moreover, whether or not one approves of this spending—and also, of course, approves of the taxing that goes with it—it’s also true that real people are affected by the budget as the money actually gets spent. After all, just about everyone counts on the federal government to do one thing, or many things, from preserving retirement, to defending the homeland, to protecting the environment.

And many of these real people, living outside the I-495 beltway, might not be hip to inside-the-beltway Washington gamesmanship. That is, they might see a headline about DEEP CUTS! or BUDGET SLASHED! and think that they could be at risk. Indeed, many of these people—starting with, but not limited to, the recipients of earned-entitlement programs, such as Social Security, Medicare, and veterans’ benefits—are Republicans, or Republican-leaning independents.  

So with its own reelection in mind, Team Trump might best be careful about putting out budget projections, however notional, that scare away GOP voters. 

The Baseline and the Bottom Line

Here we might pause to make a basic point about the federal budget. Because this is Washington we’re talking about, the rules of the road for Pennsylvania Avenue are different from what they might be on Main Street. That is, in D.C., a budget cut can be a cut in absolute terms (as in, spending less than the year before), or, more often, it can be just a cut in the baseline (the baseline being a number generated by the bureaucracy, based on projected growth of the eligible population, plus inflation).  

And so, for example, if the baseline is presumed to be growing at four percent a year, then holding that growth to just a two percent increase can be seen as a two percent decrease (4 – 2 = 2). Or, of course, baseline growth trimmed to just two percent can be seen as . . . a two percent increase. So we can see: There are many ways to define budget reality.

Supporters of the baseline concept say it’s simply a realistic way of doing budgets. Detractors say it’s a permanent escalator for spending. Yet either way, it’s the way that This Town does its business, and the Trump administration, over the last three years, has not sought to change the baseline orthodoxy. Maybe it should have, but it didn’t—and for this term, at least, it’s too late now.

Meanwhile, the baseline concept becomes acute in re: Medicare, which will spend $830 billion in the 2020 fiscal year and is projected by the administration to spend $896 billion in 2021. 

We might ask: Can a program that big, and growing that fast, withstand some nip-and-tucks while still protecting the essential health and dignity of America’s retirees? The administration thinks so; it has slated some $130 billion in such nips, spread over the next decade—although, mindful of President Trump’s pledge to protect Medicare, it prefers to call the nips “modernizations.”   

In the fair-minded words of Yuval Rosenberg and Michael Rainey at The Fiscal Times, “Trump’s budget proposes to reduce the growth in Medicare spending, but it does not propose cuts in Medicare benefits.” So it would seem that, yes, Trump is keeping his word about protecting Medicare—while at the same time, trying to restrain spending a little bit.  

Yet still, it’s possible for critics to seize on those Trump changes and call them “drastic cuts.” Hence this February 10 headline in the left-wing Vox: “Trump vowed to not cut Social Security and Medicare—hours before proposing just that.”

We can make the same point about student loans: The headline atop CNBC reads, “Trump looks to kill student loan forgiveness program.” As the article details, the Education Department hopes to scale back student-loan forgiveness, to the tune of $170 billion over the coming decade.   

Now we might say, with no small amount of justification, that the current student-loan program is a boondoggle, but if we do, then we need a serious plan for revamping student loans, laid out in speeches, white papers, and congressional testimony. That is, it’s neither good governance, nor smart politics, simply to yank the rug out from under people. If the administration wishes to make a case for student-loan reform, it has to do the hard work of persuasion: It has to actually make the case to the public, and win the argument.  

And yet little of this persuasion has even been attempted, and so public opinion is solidly against the Trump idea. As the CNBC article tells us, 

Eighty percent of Americans agree that the government should make it easier for people with student debt to repay their loans, a study by The Pew Charitable Trusts found. Another poll found that nearly 60% of registered voters said they would support a plan to cancel all existing student loan debt.

As we can see, the nation is much closer to the Bernie Sanders/Elizabeth Warren idea of a debt-jubilee than it is to any Republican idea of making young people pay back onerous loans. 

Thus we can further see that the administration’s student-loan proposal isn’t going anywhere. Congress will simply ignore it, and thereby nix it.  

So we can ask: Why is the administration bothering with this student-loan proposal at all? Why go through the exercise of proposing cuts that don’t happen—cuts, that, in the meantime, simply anger people? Especially when there’s an election in nine months?  

And there are other issues, too, that rile people up, such as the proposed 26 percent cut in the Environmental Protection Agency. In terms of the policy merits, there might be an argument to be made, somewhere, for such a cut, but in terms of the political optics, it’s a non-starter. Congress will never go along, and Trump won’t push it. So the cut to EPA is another DOA.   

And to this dolorous list of Capitol Hill losers, we can add, as well, the proposed zeroing out of the National Endowment for the Arts and the National Endowment for the Humanities. This author, who way back when worked in domestic policy in the Reagan White House, well remembers all these kinds of cuts being proposed in the 80s—and being met with brickbats, and brick walls.   

So again, what’s the point in proposing something that gets just a handful of votes—and sometimes, literally, zero votes—in Congress? Talk about things that are full of sound and fury, signifying nothing!  

Today, this Republican president, like all Republican presidents, must be careful to avoid getting the worst of both worlds, budget-proposal-wise. That is, the GOP administration puts forth proposals for cuts that won’t happen—and that it knows won’t happen—because they seem like “the right thing to do.” The Trump budget, for instance, makes the hardcore budget-cutters at the Heritage Foundation at least somewhat happy, although Heritage, of course, is always hoping for big cuts in earned entitlements. (Such cuts are not a good idea, of course, in an election year, or, really, in any year.) 

By now we should have learned that the presidential budgets that please think-tank ideologues are likely to displease actual voters. That is, innocent low-information voters—you know, regular folks—might take the budget proposals seriously, and be provoked to vote defensively. In other words, too-aggressive cuts, even if put forth only in theory to please zealous scholars-in-cubicles, seem to be self-defeating, because they antagonize Americans who don’t know that the cuts are only theoretical.  

The Trump Budget Vision—and More Critics

For its part, the Trump administration chose to highlight the new budget’s emphasis on jobs and the economy; the headline atop its fact sheet reads, “President Trump’s FY 2021 Budget Commits to Double Investments in Key Industries of the Future.” And so, for example, the administration wants to spend six percent more on research and development, and to double spending on such visionary stuff as artificial intelligence and quantum information science.   

And yet at the same time, the administration has committed itself to overall numbers that purport to balance the budget in 15 years. Was this exercise necessary? After all, under the best-case scenario, Trump will be in office only for another five years. So why spin out numbers for a decade beyond that?  

In fact, the further out the budget numbers go, the deeper the budget cuts—once again, in theory.   

Yet theory or not, the political backlash has been real. ABC News headlined its story, “President Trump releases 2021 budget proposal, calls for cuts to social safety net programs.” The piece quoted House Speaker Nancy Pelosi saying that the budget would “inflict devastating cuts.”  

Indeed, House Budget Committee chairman Rep. John Yarmuth (D-KY) didn’t even wait to see the budget before blasting it. On February 9, the night before the budget’s debut, he declared, “This destructive and irrational President is giving us a destructive and irrational budget.”

Yet as we have seen, the budget document released on the 10th does no such thing—because it’s only a proposal. As the Washington Post explained, “The budget is a proposal to Congress, and lawmakers have mostly rejected the White House’s proposed cuts in the past.” And as Democrat Yarmuth also jibed, “Congress will stand firm against this President’s broken promises and his disregard for the human cost of his destructive policies.”

In fact, the Democrat-controlled House of Representatives of Pelosi and Yarmuth has more power now over the budget than does the Trump administration.  

And so, of course, so does the Republican-controlled Senate. Thus it was interesting to see the chairman of the Senate Budget Committee, Sen. Mike Enzi (R-WY), saying, in response to the Trump budget:

I want to encourage people . . . not to waste any time searching out the president’s budget cuts. Nobody has listened to the president in the 23 years that I’ve been here. Congress doesn’t pay attention to the president’s budget exercise. I don’t know why we put him through that.

Enzi added that he wouldn’t hold any hearings on Trump’s budget, recalling that he had similarly ignored former President Barack Obama’s budgets. In one final snap, Enzi added, “Congress holds the purse strings, according to the Constitution, and Congress is very protective of that constitutional authority.” 

So again: The administration should be careful about budgets that go nowhere and are only objects of criticism. To put that in blunter terms: Don’t give your opponents the stick they can beat you with. 

In fact, Washington being Washington, the critics have nothing better to do than to poke through every line item, looking for bones to pick. And so, for example, even as OMB touted its tech-investment plus-ups, others were calculating the cuts. Thus the Washington Post took note of the 16 percent cut in the Centers for Disease Control and the $3 billion chop in the National Institutes of Health—and this at a time when the world is wrestling with the coronavirus.  

The Post also quoted Sudip Parikh, chief executive of the American Association for the Advancement of Science, saying:

The administration’s proposed budget cuts to research risk slowing our nation’s science just when it is reaping benefits for all Americans in the forms of better health, a stronger economy, a more sustainable environment, a safer world, and awe-inspiring understanding. 

Listening to the critics, one might never know, for example, that Trump has proposed record-high spending for HIV/AIDS research and treatment.  

So we can see: In a budget this big, and a country this big, friends and foes can always find something to like and not to like. The goal in politics, of course, is to put forth a greater number of likable things than unlikable things.

Reducing Spending by Getting Out of Afghanistan

Oh, and one last thing, speaking of spending items not to like: Did we mention the war in Afghanistan? That’s its own little dead-end budget-buster. In 2019, the U.S. spent $52 billion in that country, and the cumulative total of the war has reached $975 billion. And yet even now, more than 18 years into the fighting, nobody can get straight answers. As Sen. Josh Hawley (R-MO) tweeted angrily just on February 11:

The US Inspector General for Afghanistan testified today that the Pentagon has no clear metrics for success or failure in Afghanistan, no reliable way to tell if Afghan security forces are working, no way to tell if we’re succeeding in that region.

In other words, we’re spending the Afghan money blind. And of course, we’re spending something even more precious—American blood. 

So perhaps it’s best to take Enzi’s advice. The administration shouldn’t even bother with a budget; let Congress figure it out. Indeed, perhaps the sagest commentary came in the form of a headline from the Associated Press on February 9, before the budget was actually released: “Trump budget to face skepticism, be overwhelmed by politics.” Indeed, overwhelmed by politics. So why play that losing budget game at all? Why propose things that give the other team a chance to score?  

In fact, the administration’s resources are much better spent figuring out, for real, how to get out of Afghanistan.  

And happily, late-breaking news on the 11th tells us that Trump—having just come from Dover Air Force Base to pay his respects to the two most recent American soldiers killed in Afghanistan—might be on the edge of an agreement to get the U.S. out. 

Let’s pray that this deal is for real. And of course, an exit-strategy for Afghanistan is much better news for Trump in 2020 than the pseudo-news coming out of the budget mess.