Monday, October 18, 2021

The Democrats’ Deficit spending issue carries high stakes for their candidates

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If Democrats let the Deficit issue dominate their political discourse, their chances for victory in November 2020 could be derailed. But they would not be making the right decision.

Democrats’ Spending Fight Carries High Stakes for Their Candidates

Before November’s midterms, Democrats in Washington made little effort to discuss their next steps after the new Congress was seated. They often spoke glowingly of the parties majority gains and talked in narrow terms about “tax reform” and “green energy” while promising to hold the line on state spending.

With their rhetoric and the recent passage of the budget resolution that supports the continued spending of the Pentagon and the failure of Democrats to try to curtail the social welfare programs that they want more money for, the Democratic Party on the House and Senate sides seems to be doing little to articulate their larger vision to voters next November.

Democrats are not defending a sizeable deficit. In fact, they are projected to become in the next few years the most-profitable party in the country because of the money flowing into the federal treasury, thanks in large part to the $15tn economic stimulus put in place by the Trump tax cuts and the inevitable spending increases that are required to keep the government running.

Republicans say that their spending record speaks for itself, and they are correct, but what they forget is that they also must figure out a way to make that deficit smaller. In fact, the deficit spending of the last few years, which helped to swell the national debt, is not going to be enough to pay for federal programs or military intervention. And that is why there is a strong fiscal incentive to stand for reductions in entitlement spending. Democrats need to put down markers now so that their Republican colleagues don’t get away with portraying them as expansionists with a reckless spending agenda.

The Budget Resolution

Evaluating Democrats’ choice of issues will be particularly challenging this week as Democrats continue to wrestle with the budget resolution. Within the parameters of that resolution are the spending levels for 2019 and for 2020. Republicans like Senator Marco Rubio of Florida have repeatedly stated that the budget resolution is the most important piece of legislation for the entire 113th Congress and warned that both Congress and the president must act with urgency to find agreement on their spending plans.

The Democratic resolution not only supports the Pentagon’s budget, but it also includes $36bn in funding for “biomedical research” and $45bn for “coastal security”, both of which constitute significant increases from the current levels. In addition, the Democratic party resolution promises new programs that are anticipated to cost $22bn, but that is not included in the resolution. The additional new spending will likely come from cuts to other programs and services, programs that Democrats are right to be wary of reducing.

Recent projections show that there will be a $1.1 trillion surplus in 2027 if all entitlement spending is brought within the cap set by Congress. There has already been a federal government surplus in the prior few years and the CBO projects that there will be more surpluses in the years ahead. Even if the budget resolution does not add to the deficit, as some progressive Democrats and some Republicans argue, the fact that Republicans continue to support spending increases is a fundamental problem.

So the question is not whether Republicans are hypocritical and irresponsible deficit spenders but whether Democrats are hypocritical and irresponsible fiscal hawks when it comes to military spending. For the sake of credibility, Democrats should extend their rebukes of excessive military spending, equal if not greater, than they have done in recent years. What they should not do is unnecessarily narrow their focus to the military.

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