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As a policy/PR stunt, the spending freeze seems geared entirely around satisfaction of the Washington Post editorial page. In terms of political strategy, this seems odd.
Well, in fairness, the president also wants to please the Tribune editorial board and other
moderate centrist corporatist establishment voices who partied while Bush set the economy on fire and who are now pissed that the president can't fix it by cutting taxes and fighting two wars and keeping inflation down (and if he can bring employment down to single digits, that's swell but not as urgent as not frightening Wall Street).
Oh, right: The big news about the upcoming State of the Union speech is that the president will propose a three-year non-military discretionary spending freeze (which probably isn't going to amount to more than a drop in the bucket). It's not going over well.
It’s appalling on every level.
How will this look, for example, if there's a double dip recession, or if unemployment follows the dismal path that the administration itself has forecast?
If it really is as small a deal as it now looks, it is not a budgetary and economic disaster—it is a rhetorical, political, and messaging disaster.
It could, I suppose be argue that the cuts involved will be (in the context of federal outlays) trivial enough to make the Hoover reference unfair. But if the best case is that it's an irrelevant political gimmick, you have to consider the politics, which are pretty much a disaster.
I'm sure that in the short term it polls well. Most voters don't have a great grasp of what makes up the federal budget and the fact that about two-thirds of what the government does is security and social insurance for the elderly. Thanks to decades of right-wing attacks on Big Government, many people think that most of what the government spends money on are things like food stamps and foreign aid.
Michael Linden (writing before the current proposal was made):
The budget deficit is likely to average about $900 billion per year over the next five years. Even by the most expansive definition of “pork-barrel spending,” earmarks amount to less than $20 billion a year. Eliminating them all would reduce the deficit by less than 3 percent....
Freezing discretionary spending, the spending that Congress reappropriates every year, at current levels will similarly yield only very small budgetary savings. The federal government spent a bit more than $625 billion on non-defense discretionary programs in 2009. The Congressional Budget Office projects that, in five years, the federal government will spend about $660 billion on the same programs. Freezing non-defense discretionary spending at current levels would therefore only produce a total savings of $35 billion in 2015. That year, the budget deficit is expected to be around $760 billion. Saving $35 billion would solve less than 5 percent of the problem. There may be some savings to be found in non-defense discretionary programs, but a spending freeze would accomplish extremely little in the way of measurable deficit reduction.
[Something to keep in mind the next time John Kass uses the term "porkulus."]
In fact, the incredible budgetary decline that took place under President Bush is responsible for far more of our current deficit troubles than any new initiative taken under President Obama. More than 50 percent of 2009’s huge deficit can be directly attributed to policies enacted by the previous administration, and that is not counting the 20 percent that was due to the economic disaster that began and gathered its momentum on President Bush’s watch. President Obama’s efforts to rescue the economy, on the other hand, are responsible for only 16 percent. Much more importantly, the long-term fiscal damage done by the Bush administration absolutely dwarfs any lasting effects of the temporary economic recovery measures taken under President Obama. The Bush-era tax cuts alone will add more than $5 trillion to the budget deficit over the next 10 years.
I’m not sure who the White House thinks it can fool but the last paragraph makes clear that there is no long-term thinking in this public policy. If you want to go long-term and substantive on deficit reduction, you have to address military spending, Social Security, Medicare, and Medicaid. Everyone knows that.
It's also evidence of the White House's failure to win the argument over the stimulus. The administration is smart enough to refuse specifically tying the freeze to the recession. But the freeze is entirely a function of voter concerns over the recession. And the fact that those voters think the right response is to cut government spending is evidence that the administration has not convinced them of the basic case for the stimulus, or persuasively explained the basic nature of the recession.
What we have here is a failure to communicate.
Well, yes. But the audience that they're trying to communicate to with this proposal - fake-ass deficit hawks (in Linden's term, "peacocks") like the editorial boards of the Washington Post and the Chicago Tribune - cannot, at this point, be communicated to. How do you try to sell a responsible budget plan to people who are so willfully ignorant of history that they think the president who turned the US from a creditor to a debtor nation is a model for responsible governance specifically with regards to the deficit? I've tried: it's very hard to be more wrong than that. As Chris Hayes argues, why encourage their ignorance?
The freeze (here's why that term in particular is a bad idea in and of itself) doesn't seem like it will amount to much, at first glance. And it may not amount to that much of the SOTU address. What will be interesting to see is if Obama is willing to take whatever theoretical leverage this ploy is supposed to give them with the country's ignorant pundit class and use it to push actual containment strategies towards actual runaway spending (see Linden above) like health care reform.
If not, God help us.