The revolutionary rhetoric of the early days of the 104th Congress far outdistanced that Congress’s fiscal achievements. Shortly after the 1994 election, Newt Gingrich triumphantly declared that Republicans would “radically transform the way government works by Easter.” The question now is, Easter of which year? To be sure, the GOP did grind out some impressive work. It cornered Bill Clinton into committing to a balanced budget by 2002, thus (one hopes) limiting Democratic wish lists for new spending. It cracked welfare reform. And its 1996 budget produced the lowest rate of increase in federal spending in nearly a generation. The $107 billion deficit that resulted is nearly $100 billion less than Clintonomics would have wrought.
But unfortunately, this progress may prove to be short-lived. Even with the slightly better numbers forthcoming from the Congressional Budget Office, the deficit is expected to gallop in the wrong direction for years to come, hurdling the $200 billion mark by 2001 and the $250 billion mark by 2005. (Clinton’s veto of Medicare and Medicaid reforms explains much of this increase.) It’s a good bet that, without a balanced-budget amendment to the Constitution, the present $107 billion deficit will be the low-water mark for at least the next decade.
So where do Republicans go from here? Right now, their strategy is hopelessly timid and adrift. Outlined below, therefore, is a four-step game plan for the 105th Congress.
1.)Whenever and wherever the president offers specific proposals for domestic-spending reduction or tax cuts, Congress should instantly snatch them up. The rope-a-dope strategy of letting Clinton go first on spending cuts, Medicare, and tax relief makes sense in the aftermath of the 20-month-long blitzkrieg of demagoguery from the White House and the union bosses. So, the day after Clinton releases his budget, the House and Senate should immediately approve all of his proposals to make government smaller or less costly, then send them back for the presidential signature. Bipartisan agreement that government is too big and costs too much is a good thing. And even an Olympic-caliber contortionist like President Clinton would be hard-pressed to explain a veto of his own budget recommendations.
Be warned, however: This tactic promises only small, symbolic victories. For the past four years, the Clinton administration’s budget submissions have been flimsy. The Institute for Policy Innovation recently discovered that Clinton is the first president in a quarter-century to propose higher spending than the level later approved by Congress. To expect a stockpile of useful ideas in this year’s Clinton budget is to believe that, just this one time, Lucy is going to hold down the football for Charlie Brown.
When asked during the campaign to list federal programs that America might live without, the administration identified a grand total of three: the Tea Tasters’ Board, the Uniformed Services University of the Health Sciences, and a dairy farm owned by the Naval Academy. The total savings? Twenty-million dollars– about what Medicare spends in a half-hour. We can expect from Clinton’s January budget what this administration always produces: a high, spiraling punt back to Congress. After that, Gingrich, majority leader Trent Lott, House budget chairman John Kasich, and the rest are going to be left with the heavy lifting. Which leads to the second step.
2.)The balanced-budget amendment must be preeminent in the political fight over the budget. The amendment is one of those rare issues around which smart politics and sound policy coincide. Yet it is a strange fact that the Left appreciates the implications of the amendment to a far greater extent than do many on the right. The Children’s Defense Fund, the labor unions, the education establishment, and countless Keynesians moan that the balanced-budget amendment would mean the slow fiscal strangulation of domestic programs. They may well be right. For at least the past three decades, deficit finance has been the mother’s milk of government’s bloating.
The decision by Gingrich and other GOP leaders unilaterally to forge ahead with a detailed plan to balance the budget by 2002, despite the one-vote defeat of the balanced-budget amendment in the Senate, was an honorable one. But it led to a political dead end, because it allowed the Democrats to block tax cuts and rail relentlessly against spending reductions without having to propose a serious agenda of their own. Indeed, the absence of a balanced-budget amendment permitted the Clinton administration to bully Republicans into adding nearly $15 billion of deficit spending in the waning days of the 104th Congress. Trying to balance the budget without the moral and legal weight of a constitutional amendment behind such an effort will forever be an act of futility. A balanced-budget amendment is imperative because, without it, the political system will retain its heavy bias in favor of borrowing over the will to cut programs.
Republicans need to announce to the public the cold fiscal reality: Unless the balanced-budget amendment is enacted, there probably will not be another balanced budget out of Washington in our lifetimes. Any political effort to achieve one– by deficit-hawks in either party– will fail. So we first have to fix the rules of the game.
3.)Get business off the dole. For more than two years, this issue has been nicely teed up, just waiting to be whacked out of the park. And the Republicans keep whiffing.
Imagine how differently the debate over the budget might have gone if, back in April 1995, Republicans had first targeted, not school lunches, but the Export-Import Bank, which provides cut-rate insurance to America’s Fortune 500 companies. Or the Advanced Technology Program, which channels techno-pork to politically well-connected firms like General Electric, Texas Instruments, and Motorola. Or sugar subsidies to multi-mullion-dollar plantation owners. A high-profile attack on these giveaways would have discredited the Left’s caricature of conservatives. Admits Sen.-elect Sam Brownback of Kansas, “We need to prove that we’re willing to gore the ox of taxpayer-funded Republican constituencies.”
But so far, they have not. Even though a flood of tax dollars is poured down the corporate-welfare rat hole each year, less than 15 percent has been cut since the Republicans assumed power in Congress. The price of spending programs for business– inside the Agriculture, Commerce, Defense, Energy, and Labor departments– exceeds $70 billion a year, enough to halve the budget deficit and still have enough left over to “pay for” a cut in the capital-gains rate and the elimination of the inheritance tax. Reducing the deficit and erasing those anti-growth taxes would do far more to benefit American industry and U.S. global competitiveness than asking the likes of Sens. John Chaffee and Carol Moseley-Braun to pick industrial winners and losers.
Defunding big business would be political pay dirt for one other reason: Although there is no scarcity of corporate statists inside the GOP, it turns out that, on balance, liberal Democrats are the fiercest supporters of industrial pork. There are some prominent Democrats who have tried to reduce aid to dependent corporations– Sen. Russ Feingold, for one– but they are exceptions. In the 104th Congress, when Kasich forced up-or-down votes on many corporate-welfare poster children– the Overseas Private Investment Council (run by Ruth Harkin, Sen. Tom Harkin’s wife), the Export-Import Bank, the USDA Market Access Program– Republicans by a nearly two-to-one margin voted to pull the plug, while Democrats by the same margin voted not to.
And much of this support for subsidies was rallied from the White House, the chief defender of the corporate safety net. For example, the rescue of the Commerce Department, the command-and-control center of the corporate welfare state, has become a Clintonite crusade. Exposing the Clinton White House and congressional Democrats as hypocritical defenders of business handouts, and Republicans as adversaries of such handouts, would only be a PR bonanza for the GOP As Sen. Fred Thompson says, “All that is lacking is the good political sense to capture the issue.”
4.)Terminate a select group of vulnerable spending programs– particularly those that directly fund the Left. Apart from the House barber shop and the Consumer and Homemaker Education program, after two years of GOP control of Congress, there isn’t much of consequence that the government was doing two years ago that it isn’t still doing today. For a half-century, Democrats proved expert at creating a plethora of agencies, boards, and bureaucracies. One of the critical reasons voters lost confidence in the Democrats is that even some fervent believers in the New Deal and the Great Society don’t imagine that these programs should be afforded eternal life.
Clinton’s successful MMEE campaign mantra (Medicare, Medicaid, education, and the environment) has probably taken these four areas off the cutting board for the next two years. But that’s fine. By singling out these as sacrosanct, he has tacitly acknowledged that everything else is in play.
Which leaves some big game for the 105th Congress to start hunting. The egregious Davis-Bacon Act, for example, requires union wages to be paid on federal construction projects and is estimated by the General Accounting Office to cost taxpayers $2 billion a year in inflated costs. These dollars flow directly into the political war chest of Big Labor. So, an end to this ’20s era program is a no-brainer: It saves taxpayers a bundle and goes to the jugular of the AFL-CIO. If Republicans don’t have enough sense to stop aiding and abetting their mortal enemy, they deserve to have another $35 million times two spent against them by labor in 1998.
Consider also the Legal Services Corporation, which gift-wraps $300 million in taxpayer dollars each year to left-wing legal-aid groups. Much of the money is now used for class-action political advocacy– to fight welfare reform and tax reduction, to defend rent control and free public services for illegal aliens– rather than to represent poor people in small-claims court.
So, the 105th Congress needs to create a graveyard of obsolete federal programs. The tombstones should have epitaphs that read,
NATIONAL ENDOWMENT FOR THE ARTS– 1965–1997
For more than a generation it spent $2 billion on
offensive obscene “art,” assaults on American culture,
and opera for wealthy suburbanites.
FEDERAL TRANSIT ADMINISTRATION– 1968–1997
For nearly thirty years, it played Santa Claus to America’s
mayors. It is survived by the $2.5 billion Miami “metro
fail” subway system and the Detroit People Mover, a trol-
ley that carries virtually no one to virtually nowhere.
All of this is to say that the next Congress should set achievable priorities to shrink the federal government. Get results. Produce some body bags. Given the increasing fiscal conservatism of the electorate– voters in post-election polls indicated by a more than two-to-one margin that they favor less government and lower taxes– statists cannot possibly defend every inch of government’s vast terrain.
“This time around, we clearly need to pay more attention to style points,” concedes Sam Brownback. “When we cut government spending, we should do it in a friendly way.”
Or, to put it another way: Speak softly, but carry a big ax.