(C) Common Dreams
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Gut spending? Slash the IRS budget? 7 GOP ideas for debt limit talks. [1]
['Jeff Stein']
Date: 2023-02-05
Big cuts to agency spending
The most likely GOP demand is sweeping cuts to the part of the federal budget known as “discretionary” spending, which excludes programs such as Medicare, Medicaid, food stamps and Social Security. This type of spending — which includes funding for the Defense Department and other federal agencies — jumped from close to $1.1 trillion a year to $1.6 trillion a year between 2017 and 2023, as Congress went on spending sprees during the Trump administration and the first two years of the Biden administration, said Brian Riedl, a conservative policy analyst at the Manhattan Institute, a right-leaning think tank. That number does not adjust for substantial increases in inflation.
Republicans have looked at cutting this type of spending — which amounts to roughly 30 percent of the entire federal budget — to the levels spent in the 2022 fiscal year. That may not sound dramatic, but it could mean slashing funds for most domestic programs by as much as 20 percent because Republicans don’t want to make any cuts to the military or veterans’ benefits, according to Donald Schneider, who served as a top aide to House Republicans on the Ways and Means Committee and is now deputy head of U.S. policy at Piper Sandler, an investment bank. That would reduce overall domestic spending by about $130 billion next year. Some Republicans are proposing rolling spending back to FY 2019, before the pandemic, which would mean a $195 billion cut if defense spending stays the same, Schneider said.
A recent paper by the Center on Budget and Policy Priorities, a left-leaning think tank, found that despite the increases funding for these domestic programs is below 2010 levels when adjusting for inflation and population growth, excluding veterans benefits.
These cuts would hit politically popular programs such as spending on energy assistance for low-income Americans; K-12 education; Pell Grants for college students; the National Institutes of Health; NASA; and others. There are other, potentially less dramatic options, such as freezing future increases in non-Pentagon spending or just cutting spending by less, Riedl said. Another idea being batted around is to demand $3 of spending cuts for every $1 increase in the debt ceiling, although that still leaves the all-important question of what to cut.
“There’s plenty of room for savings from caps, and even if you approved no savings, it would still create a constraint on the appropriations process so they could not keep growing much faster than inflation,” said Marc Goldwein, senior vice president at the Committee for a Responsible Federal Budget, which advocates for lower debt. “There’s plenty you can do there that would be quite meaningful from a fiscal perspective.”
Cutting discretionary spending might provoke less outrage than cutting Social Security and Medicare, but these cuts could still prove difficult for Republicans to push — and for Democrats to accept — so soon after the GOP signed off on major spending increases under the Trump administration. “It’s not realistic,” Schneider said.
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[1] Url:
https://www.washingtonpost.com/us-policy/2023/02/05/debt-limit-gop-proposals/
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