WASHINGTON, February 14, 2018. Republicans used to be the party of fiscal responsibility. The party opposed to deficit spending and calling for balanced budgets. Those days are now over.
Are we looking at $1 Trillion deficits?
After embracing $1.5 trillion in debt by slashing taxes in December, Republican leaders in Congress have now pushed through a two-year budget that will increase spending by nearly $400 billion. Sen. Rand Paul (R-KY) warns of a return to $1 trillion deficits, with a reminder that this is “the kind of behavior we as Republicans denounced in the Obama years.”
“If you were against President Obama’s deficits, and you’re for the Republican deficits, isn’t that the very definition of hypocrisy?” The Wall Street Journal declares that Republicans now believe “that budget deficits don’t matter.”
In 2011, Republican lawmakers refused to raise the federal debt limit until President Obama agreed to deep cuts to government programs. Republican leaders opposed stimulus spending in 2011 and 2012, when the economy was failing and unemployment was high.
Those same leaders now call for the government to fuel the economy with huge deficits when the unemployment rate is about half of what it was then and corporate profits have dramatically increased.
Those who have power and those that do not
It is interesting to see how politicians act when they are in power. Particularly in contrast to how they speak when they are not.
Consider House Speaker Paul Ryan, who now embraces huge deficits. In 2012, when Democrats were in power, Ryan told us that,
“In this generation, a defining responsibility of government is to steer our nation clear of a debt crisis while there is still time.”
Or look at the strange case of Mick Mulvaney, the White House Budget Director. As a Republican Congressman from South Carolina, Mulvaney was a fiscal hawk. In 2011 he helped draft the Cut, Cap, and Balance Act, which called for large and immediate reductions in spending, a statutory cap of 19.9% of GDP on future outlays. There were also requirements for a balanced budget amendment to the Constitution.
President Trump appointed Mulvaney to his White House job. Mulvaney said that he would help restore “fiscal sanity, after eight years of an out-of-control, tax-and-spend financial agenda.”
OMB’s changing tune
Mulvaney and his colleagues at the OMB predictions were that the budget would balance over ten years. That pretense has left the building.
In 2028, according to the new budget, the deficit will still be $445 billion or 1.4% of GDP. But these figures are dubious and, in the view of most economists, depend on unrealistic assumptions on spending and economic growth. The Committee for a Responsible Federal Budget, a watchdog group, predicts that the deficit could rise to $1.7 trillion by 2027.
President Trump, who in his business life once proclaimed himself “King of Debt,” promised during the presidential campaign, to balance the budget in the next decade. Instead, his latest budget runs a deficit every year.
Doug Holts-Eakin, of the conservative American Action Forum, and an economic adviser to Republicans says:
“This is a step in the wrong direction.”
Is President Trump failing on his budget campaign promise
President Trump keeps saying that he is committed to fulfilling his campaign promises. This seems not be the case when it comes to the budget and defense spending. And almost all Republicans have joined him in embracing deficit spending, with a few rare exceptions.
“This spending bill is a debt junkie’s dream. I’m not only a no, I’m a hell no,” said Rep. Mo Brooks (R-AL), who predicted trillion dollar deficits. Rep. Jim Jordan (R-OH) declared, “It’s the wrong thing to do because it’s not consistent with what we told the American people we were going to do and what we were elected to do.”
Republicans once felt that an efficient government was one strong on cutting ‘waste, fraud and abuse.’ The first phase of the first-ever Pentagon audit recently found the Defense Department is unable to account for some $800 million in spending.
Other defense agencies remain to be audited.
Republicans, however, have added $165 billion over two years in new funding for a department which is having difficulty accounting for the $700 billion it already has.
The withering of tradition Conservative spending views
What we have at the present time is a Republican president with congressional leaders no longer holding onto traditional conservative views on spending. And the party is unwilling or unable to resist. At least a few conservatives see how the Republican Party has abandoned its traditional economic views.
“This is fiscally reckless. This is mortgaging the future on steroids,” said Romina Boccia, a budget expert at the Heritage Foundation.
The Framers of the Constitution view of debt is far different than those leading the Republican Party today.
James Madison said that,
“Debts and taxes are the known instrument for bringing the many under the domination of the few…I go on the principle that a public debt is a public curse.”
Thomas Jefferson spoke of the danger of out-of-control government spending and increasing debt:
“To preserve our independence, we must not let our rulers load us with perpetual debt. We must make our election between economy and Liberty, or profusion and servitude.”
Not the Republican policies conservative voters voted for
Americans didn’t think that electing a Republican President and Congress meant that they were calling for the hugest deficits in American history. But that is what they have now.
The Republican Party of 2018 can no longer be recognized. The 19th century British Conservative leader Benjamin Disraeli once said that,
“The first thing a conservative must ask is what it is he seeks to conserve.”
In America at the present time, we no longer have a traditionally Conservative party. Maybe someday such a party, which we desperately need, will re-emerge.