It’s one thing to talk a good game about cutting spending, but it’s quite another thing to actually do something about it. This week, the House of Representatives has an opportunity to finally set some limits on Washington’s spending spree while also ensuring that the U.S. military has the resources it needs to defend America. Here’s the lay of the land this week in the nation’s capital.
On Thursday, the House is set to take up a spending reduction plan known inside the beltway as “reconciliation.” Under the measure, Congress would tackle two looming problems hanging over Washington’s head: the soaring cost of entitlement spending and the arbitrary defense cuts mandated by the so-called Budget Control Act (BCA) that was enacted last year.
Those issues are nothing to gloss over, even though some in Washington would like to pretend they’re not a problem. Since 1965, spending on Medicare, Medicaid and Social Security has more than tripled as a share of the economy, is continuing to grow at a rapid rate, hitting 9.7 percent of GDP this year, and will nearly double by 2050. Meanwhile, spending on defense has dropped over time, even when you add in the costs of the wars in Iraq and Afghanistan. As you can see in Heritage’s Federal Budget in Pictures, that means that spending on entitlement programs is crowding out spending on defense — a core constitutional function of government.
The U.S. military is about to get slashed and burned even further under automatic spending cuts known as “sequestration,” which is mandated under last year’s Budget Control Act. Under sequestration, future defense spending will be cut across the board by nearly $500 billion beginning next year. Add in the $487 billion in cuts already put forward by the President in February (as projected by Secretary of Defense Leon Panetta), America’s military will see its budget drop on average by $100 billion annually over the next decade.
Panetta warned that those cuts will be “devastating,” leaving America with “[t]he smallest ground forces since 1940,” “a fleet of fewer than 230 ships, the smallest level since 1915,” and “[t]he smallest tactical fighter force in the history of the Air Force.” General Martin Dempsey, Chairman of the Joint Chiefs of Staff, bluntly told Congress that the mandated reductions create “very high risk” to national security.
Some in Congress would like to rely on defense cuts in order to balance the budget while keeping spending on entitlement programs intact. But that just won’t work. Even if defense spending were completely eliminated, entitlements would continue to drive deficits to unmanageable levels. That’s why Congress must take action to get that spending under control.
Heritage’s Patrick Louis Knudsen writes that though the budget reconciliation falls short in some areas — namely, it suspends only one year of the sequestration, meaning Congress would have to address the issue again in 2013 — he says it is a key part of implementing the budget passed by the House in March. The benefit, Knudsen explains, is that it is “the only fully developed plan for addressing the near-term problem of sequestration and the longer-term issue of runaway entitlement spending.”
Under the reconciliation plan, national security capabilities would be protected and the sequestration’s deep defense cuts would be reversed. As for entitlement spending, the plan introduces important reforms to the food stamp program, which has grown dramatically under President Obama, with spending shooting from $39 billion in 2008 to $80 billion in 2012. Knudsen explains that the reconciliation plan eliminates categorical eligibility — the policy of granting cash welfare assistance regardless of one’s income or assets. In addition, the plan finds savings by reforming the National Flood Insurance Program and ending the Obama Administration’s ineffective housing bailout, the Housing Affordable Modification Program, among other measures.
Knudsen writes that “The longer Congress delays, the more likely are steep, sudden benefit cuts, sharply higher taxes, deeper deficits and debt — or all of the above.” Washington can’t keep putting off its fundamental duty to enact a budget and get spending under control, and it shouldn’t try to solve the nation’s fiscal crisis by gutting America’s national security.