The Budget
It’s hard not to read budget projections like this one, by Stanford Economist Boskin, and be worried. The Democrats are increasing spending faster than just about any previous administration–almost five trillion dollars above baseline–without paying for it.
Suppose that Obama is reelected and serves until 2016. The financial crisis, plus the military commitments in Iraq and Afghanistan should be long gone by that point. But because of all of the increased spending, we’re looking at about $700-800 billion in government deficits by that point. That’s huge, and reflects a permanent shift in the government’s accounts.
In fact, that figure is possibly conservative–it reflects the assumption that the economy recovers relatively quickly. More importantly, it assumes that military spending will decline to levels we’ve never seen it at. But America goes to war at least once a decade, and can almost surely assume that one of the various hot-spots around the globe will erupt sometime in the next eight years. How are we going to pay for that?
This is not spending that can be cut, either. Taxes are going to have to go to pay for it, and narrowly targetting the (ever-smaller) rich isn’t enough. The middle-class is going to have to pay for the growth in entitlement programs.
Much of the spending growth will happen through healthcare. Extending health coverage to all American, regardless of employability needs to happen. But the manner in which we do so should be open to debate. Right now, the dominant plan mirrors Massachussets by simply extending government coverage to more people. But the results of that experiment suggest that increasing coverage doesn’t do anything to lower health costs, while it does strain the government’s budget. Either taxes will have to go up to pay for this, or health care will be rationed.
Look, if you believe that government should be larger, fine; increase spending and find a way to pay for it. But to spend years decrying the Republicans for destroying the budget, promise fiscal responsibility, and then go ahead and radically raise the government’s obligations, expecting someone else to foot the tax bill later on–that’s not change.
