$100 Billion Spending Cut Pledge Haunts GOP Leaders
Policy + Politics

$100 Billion Spending Cut Pledge Haunts GOP Leaders

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A Republican campaign pledge to cut government spending by $100 billion made breezily last fall has come back to haunt the new GOP House leadership. Faced with mounting pressure to appease conservative colleagues, House Republicans on Thursday bulked up their spending cut proposals from $74 billion to the promised $100 billion — although it is unclear  how they will find those savings without resorting to budget gimmicks.

With Tea Party freshmen demanding that they make good on their promise as part of a major spending resolution covering the remainder of the fiscal year, Rep. Harold Rogers, R-Ky., the new chairman of the House Appropriations Committee, made the announcement after meeting with his subcommittee chairs.

“We have determined that the [resolution] can and will reach a total of $100 billion in cuts compared to the president’s request immediately — fully meeting the goal outlined in the Republican ‘Pledge to America’  in one fell swoop,” Rogers said in a statement. “Our intent is to make deep but manageable cuts in nearly every area of government, leaving no stone unturned and allowing no agency or program to be held sacred. I have instructed my committee to include these deeper cuts, and we are continuing to work to complete this critical legislation.”

Whether Rogers’ latest maneuver — which could result in less than $60 billion of savings depending on the baseline used — will fully satisfy the conservative newcomers or not remains to be seen. Already twice this week, the GOP leaders were embarrassed when some of their members helped block passage of measures to extend the Patriot Act and compel the United Nations to return $179 million to the U.S. Treasury. 

Rep. Michelle Bachmann, R-Minn., leader of the House Tea Party Caucus, indicated that she would offer amendments for more cuts, potentially creating high octane tensions among conservatives. “This is a start, but we need to do more,” Bachmann told The Fiscal Times on Thursday.

The bitterly partisan Congress needs to agree on a spending plan otherwise the government will shut down when the temporary funding expires. “This is welcome news, and clearly an important first political win for new fiscal conservative members of the House,” Chris Edwards, of the Cato Institute, a libertarian think tank, said of Rogers’ announcement.  

Meanwhile, Democrats used a House Budget Committee hearing to denounce the Republicans’ “hyper-narrow” spending-cut strategy, warning that it could set back the economic recovery while doing little to reduce a deficit projected to reach a record $1.5 trillion this year.  Democrats complained that the Republicans were unnecessarily targeting less than a fifth of the overall budget for deep spending cuts for the remainder of the fiscal year, while essentially walling off defense, homeland security, entitlement programs and tax breaks from close scrutiny by budget cutters.

“Immediate, deep cuts will not create a single job,” said Rep. Chris Van Hollen of Maryland, the ranking Democrat on the Budget Committee. “A broad range of economists . . . have determined that such cuts will actually hurt job growth. Additionally, Fed Chairman [Ben] Bernanke stressed that the most important thing we can do as a country is to put together a credible, long-term plan for fiscal sustainability, rather than focus on deep cuts in domestic discretionary spending over the next eight months.”

The Democrats lodged their complaints during testimony on the budget and economic outlook by Congressional Budget Office Director Douglas Elmendorf. When Rep. Allyson Y. Schwartz, D-Pa. argued that it was wrong for the Republicans to extract such large savings from non-defense discretionary spending for domestic programs and general government operations, Elmendorf agreed that the Republicans were cutting from a very small “piece of the pie.”

While the battle heats up on Capitol Hill over just how much to cut from the budget, there seems to be a shift in the public's views about federal spending. Americans are no longer calling for increased spending as they have for years, according toa new study by the Pew Research Center. The survey also shows that the public is reluctant to cut spending — or raise taxes — to balance state budgets, which cumulatively face a $125 billion budget gap, according to the Center on Budget and Policy Priorities.

Despite the shift in views, a majority favor increased spending in five of 18 areas including funding for education. Since June 2009, there have been steep declines in the number of Americans favoring increased federal spending for health care, government assistance for the unemployed and Medicare.

Americans are divided over whether it is more important to reduce the federal budget deficit or spend more to help spur an economic recovery. About 49 percent of respondents say that reducing the budget deficit should be the federal government’s higher priority, while nearly 46 percent say the priority should be spending to help the economy recover.

Even though Rogers’ cuts are $100 billion if measured against President Obama’s year old 2011 budget request — they total about $58 billion compared with current spending levels. To meet the magic $100 billion cut goal, Republicans will have to count an estimated $16 billion in defense and security-related savings and find another $26 billion of additional cuts in domestic programs

Yesterday, Rogers issued a partial roster of 70 spending cuts that will be included in the upcoming continuing resolution to keep the government operating through Sept. 30th. Some, like the high-speed rail, renewable energy and community health centers take aim at President Obama’s initiatives.

A spokesperson for the conservative House Republican Study Committee said the new spending cuts  announced by Rogers still don’t add up to the $100 billion sought by the group. “We’re happy to see movement in the right direction but are still looking for the full $100 billion in non-security, which is what was in the Pledge,” the spokesperson said.

The Obama administration and Democrats have acknowledged the need to rein in spending as the federal budget deficit is expected to reach $1.5 trillion this year, according to projections from the Congressional Budget Office. In his State of the Union address in January, President Obama proposed a five-year freeze in most discretionary spending.

In a press conference with reporters Thursday, Senate Majority Leader Harry Reid, D-Nev., and Sen. Chuck Schumer, D-N.Y., repeatedly said Democrats are eager to work with Republicans and urged them to start negotiating even though the Republican package is unlikely to be approved by Democrats. “The House Republicans’ proposal isn’t responsible,” Reid said. “Instead of focusing on waste, they want to cut funding for initiatives that help us grow our economy and make our country more competitive.”

Reid said Democrats are watching closely what the President will recommend in his budget on Monday, and they are open to “anything that is reasonable.” Reid and Schumer wouldn’t specify what types of cuts or spending freezes they would negotiate on.  

“Right now the different factions of the House Republicans keep trying to outbid each other on spending cuts,” Schumer said. “They are blindly swinging a meat ax to the budget when they should be using a smart, sharp scalpel. This is a race to the bottom with no end in sight. Some of these House Republicans won’t be satisfied with anything less than a shutdown of government.”

Related Links
House Republicans Deepen Spending Cuts (Reuters)
Republicans to Propose $100 Billion in US Spending Cuts (Bloomberg Business Week)
GOP Shoots for Deeper Spending Cuts (Wall Street Journal)