Senator Dean Heller (R-NV) would very much like to have the so-called Balanced Budget Amendment emerge as a major topic in the 2012 elections. [LVRJ] One reason to call reporters and ask, “How does my opponent stand on the Balanced Budget Amendment?” is to enroll the press in the campaign by getting members of the media to ask the question of said opponent, and then get the results into print or on the air. It’s a game everyone plays. Some more subtly than others.
Another reason to launch the topic is that it polls well. Polling nationwide supposedly shows significant support for the idea, although few seem to appreciate the implications of this political gimmick. The air might be taken out of this trial balloon if proponents like Senator Heller were asked, “Do you favor the following cuts to federal programs?”
Slash and Burn
If the House version of the BBA were to be enacted and if more revenue was not raised:
“… (the House-passed budget resolution assumes no increase above current-policy levels) and all programs are cut by the same percentage, Social Security would be cut $184 billion in 2018 alone and almost $1.2 trillion through 2021; Medicare would be cut $117 billion in 2018 and about $750 billion through 2021; and Medicaid and the Children’s Health Insurance Program (CHIP) would be cut $80 billion in 2018 and about $500 billion through 2021.” [CBPP] (emphasis added)
Now, the question becomes — if all program cuts are distributed equally under the terms of the Balanced Budget Amendment — would Senator Heller support slashing Social Security by $1.2 TRILLION through 2021? Would he cut Medicare by $750 Billion through 2021? Would Senator Heller realize his objective of demolishing the SCHIP program under the terms of this amendment? (1)
Those wondering what might happen if Social Security and Medicare were exempted from the automatic program cuts should consult the chart constructed by the CBPP which outlines what would happen under the terms of the balanced budget amendment. (2)
Starve The Beast
The Republican Study Committee goes even further than the Slash and Burn House version. The CBPP reports that the RSC version would:
(a) cut total funding for non-defense discretionary programs by approximately 70 percent in 2021, and by more than $3 trillion over the next ten years, relative to the funding levels that Congress approved in April for fiscal year 2011, adjusted for inflation. (Relative to the discretionary caps set by the BCA, the RSC’s cuts in discretionary programs would be smaller, but still enormous.)
(b) contain deeper Medicare cuts than the Ryan budget — it includes the Ryan proposals to convert Medicare to vouchers and raise the Medicare eligibility age from 65 to 67, but raises the eligibility age sooner than the Ryan budget would.
(c) raise the Social Security retirement age to 70.
(d) contain cuts of almost unimaginable depth in the core programs for the poorest and most disadvantaged Americans. In 2021, Medicaid, SNAP, and Supplemental Security Income would all be cut in half.
Analysis by the Economic Policy Institute yielded the following succinct conclusion about the “consensus” version of the balanced budget amendment as proposed by the Republican Study Committee:
“This plan moves the goal post for the coming debt ceiling debate so far to the right that Republicans have left the stadium. Short of eliminating every cabinet agency (the entire discretionary budget), drastically defaulting on our obligations to our citizens (Social Security, Medicare, and Medicaid), or defaulting on our obligations to our creditors, this plan simply is not feasible. Even if it were feasible, cutting $1.4 trillion in federal spending by 2016—when the economy is projected to just be returning to potential output and full employment—would be economically devastating. Budget process proposals are much easier to generate than budgets, but this one is totally detached from reality. “
In short, what we have in the Senate version is a Grover Norquist Dream Budget — a starved beast — including drastically cut funding for social safety net programs like Medicare and Social Security. (3)
Symbolic Messaging
Another argument set forth by proponents of this beyond-Draconian so-called solution, like Senator Heller, asserts that the passage of a balanced budget amendment will be a SYMBOL for the business community that Congress takes deficit and debt reduction seriously. This is inane.
If Republicans were truly concerned about reducing the debt and deficits, they’d not have ignored pay-as-you-go funding practices in 2002, and they would not have espoused the Credit-Card-Conservativism practiced during the Bush Administration.
If the Republicans were honestly engaged in deficit and debt reduction activities they would have adopted a more Reaganesque posture on the matter and admit that St. Ronald increased taxation during his Administration. And, if the Study Committee were truly concerned with debt and deficit reduction they would call for a return to the Clinton Administration taxation levels when the deficit was under control.
If Republicans were serious about reducing the national debt and budget deficits, then they should give equally serious consideration to increasing the marginal taxation rate of billionaires, rather than placing more economic stress on an already overburdened Middle Class. Offering to close a few loopholes and shut a couple of tax havens is window dressing at best, and an ineffective way to approach federal financing.
Popularity Contest
While the Balanced Budget Amendment may be “popular” at the moment with voters, and while Norquist’s legions (Senator Heller among them) may advocate Slash/Burn/Starve The Beast appropriations policies, voters may be far less inclined to support a measure that would — as devised by the RSC — have a disastrous impact on Social Security and Medicare. What would happen, for example, if the pollsters ask: Do you support a measure that would balance the federal budget by cutting Medicare and Social Security? This political gamesmanship should be in a time out.
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(1) Senator Heller has not been supportive of the SCHIP program for assisting families with seriously ill or injured children. [DB] He voted against H.R. 2, on January 14, 2009 [roll call 16] When H.R. 2 was returned to the House after successfully passing in the Senate, Heller voted against the compromise version of the bill. [roll call 50].
(2) See also: New York Times, “Balanced Budget Delusion,” November 15, 2011. Congressional Research Service, “A Balanced Budget Amendment: Background and Congressional Options,” July 8, 2011 (pdf). Alliance for Retired Americans, “Fact Sheet – Balanced Budget Amendment: Bad For Seniors,” July, 2011. (pdf)
(3) Republican Study Committee: Balanced Budget Amendment summary, (pdf). Capital Gains and Games, Bruce Bartlett, “Dopiest Constitutional Amendment of All Time, ” March 31, 2011. Economic Policy Institute, “House 18% cap is as bad and infeasible a policy as the Senate’s,” June 3, 2011.
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