07.31.19

ICYMI: A 'no' vote on the budget deal is a vote to increase spending.

In case you missed it...

A 'no' vote on the budget deal is a vote to increase spending.
By U.S. Senator David Perdue
https://washex.am/2Yh25OZ

When President Trump set out to negotiate a budget deal, he had two primary goals: continue to reduce discretionary spending as a percentage of the economy, and fully fund our military.
 
Those goals were accomplished last week when the Trump Administration and congressional leaders struck a deal on spending caps and the debt ceiling. 
 
Unfortunately, many of my Senate colleagues are considering voting no on this deal, because they want to reduce spending. So do I.

In this case, however, a no vote actually is a vote to increase spending over time.
 
The first reason is that this budget deal only applies to discretionary spending. Discretionary spending, at $1.3 trillion in 2019, only accounts for roughly 30% of all government spending. The other $3.3 trillion of what the government spends comes from mandatory spending, like Social Security, Medicare, and net interest payments.
 
As President Trump intended, under this deal, discretionary spending continues to fall as a percentage of the economy over the next two years. In 2011, discretionary spending was 8.7% of GDP. With this budget deal, it is projected to be less than 6% in 2021.
  
Under this deal, the discretionary spending level increases $54 billion, or an average of 2% per year, in the next two years. As our economy continues to grow, this means that discretionary spending as a total percentage of our GDP will actually fall over the same period.
 
In the next two years, mandatory spending, however, will go up by $422 billion. Yet no one is really talking about that.
 
This deal accomplishes a second major goal of President Trump’s: it fully funds our military and gives our men and women in uniform the certainty they need to support readiness, recapitalization and rationalization.
 
So with that said, my colleagues have three paths ahead to choose from regarding this deal.
 
They can vote yes, and we will get the important accomplishments I just mentioned. Most importantly, with a yes vote, we can move on to the real task: finishing appropriations and funding the government before the end of the fiscal year on September 30th.
 
The second path is that they vote no, and we get stuck with another continuing resolution (CR), which means our military funding levels would be left in the same position as last year.
 
That doesn’t sound so bad, but in reality it would have draconian effects on military readiness and modernization. With a CR, our military would not be able to purchase much of the new equipment it needs or launch any new programs.
 
On top of that, it would actually raise military spending over the long term because it would lock in many inefficiencies currently in defense spending and totally disrupt the supply chain, adding to costs.
 
The third path ahead of my colleagues is that they vote no, and we get saddled with sequestration, meaning automatic spending cuts across the board.
 
That may not sound bad either, but it has been proven to lead to dramatic spending increases down the road. That’s because, in the future, Congress would attempt to undo the damage done by sequestration, and end up raising spending.
 
So ironically, those who are voting no on this budget bill are actually voting for significantly more spending down the road!
      
So how do we solve the debt?
 
The answer is simple. We have to grow the economy, but we must also address the real driver of the debt: mandatory spending.
 
As I mentioned earlier, mandatory spending is more than 70% of everything we spend. And that number is growing higher every day.
 
To cut down on mandatory spending and truly solve our debt crisis, we have to save Social Security and Medicare. Both are on the verge of insolvency, and the underlying costs of healthcare continue to rise.
 
To fix mandatory spending and solve the debt crisis, we have to face these challenges.
 
Before we can do that, however, we have to get past this current budget standoff. The deal that President Trump negotiated is reasonable. Discretionary spending continues to fall as a percentage of GDP. It fully funds the military. It contains no liberal policy riders.
 
Most importantly, it gives us the opportunity to finish the appropriations process before the end of the fiscal year. If we can’t accomplish this basic task, then all of this drama was for nothing. This should be our priority.