JONATHAN COHN JANUARY 15, 2012
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Has Mitt Romney committed himself to severe cuts in government spending, undermining programs on which not just poor but also middle class Americans depend? That question has been the subject of debate lately, with smart people like Ross Douthat asserting that Romney's position is less extreme, and less conservative, than liberal critics like me have assumed.
I respectfully disagree. And the single best piece of proof may be a proposal that’s gotten virtually no attention: Romney's proposal to cap federal spending, which would result in harsher cuts to domestic spending than even Paul Ryan has embraced.
How can that be? Start with some budget math. Romney he has vowed that, by 2016, he would cap federal spending at 20 percent of gross domestic product while maintaining defense spending at 4 percent of GDP. That means he would limit all non-defense spending to 16 percent of GDP.
The latest Congressional Budget Office projection suggests that GDP in 2016 will be $19.1 trillion. Sixteen percent of that is about $3.1 trillion. But, based on CBO figures, non-defense spending will be about $3.6 trillion in 2016. So to meet his goals, Romney would have to cut non-defense federal spending in 2016 by roughly $500 billion.
Romney doesn’t deny this. On the contrary, he’s been refreshingly honest on this subject. In the Washington D.C., speech where he laid out his budget vision, he said “we’ll need to find almost $500 billion in savings a year in 2016.” But Romney has not given many details on what that would entail. (Nor did his campaign respond to questions about this from TNR.) Perhaps that's because the impact of these cuts would scare the bejeezus out of some people.
Taking half a trillion dollars out of $3.6 trillion works out to a 14 percent reduction. (To be precise, it would be 14.1 percent.) Applied equally to all non-defense spending, that would mean approximately $130 billion less for Social Security and about $90 billion less for Medicare, just in 2016 alone. To give you a sense of context, the Medicare cuts in the Affordable Care Act amount to around $50 billion a year in 2016. And those cuts, unlike Romney's, are largely offset by expanded spending on Medicaid and subsidies for private health insurance, thereby cushioning the blow on the health care system.
Of course, Romney could decide to exempt Medicare and Social Security. But then the cuts for other programs would have to be much higher: 25 percent, on average. And when I say “other programs,” I mean every other non-defense thing the government does: Education, transportation, environmental protection, safety net programs, law enforcement…you get the idea. Can we afford to spend a quarter less on highways? How about the Centers for Disease Control and the FBI? Or Head Start, food stamps, and Pell Grants?
If that doesn’t get your attention, maybe this will: These cuts would be in addition to the automatic cuts already set to take effect in January, 2013, now that the deficit super-committee has failed to reach a consensus. The Center on Budget and Policy Priorities recently wrote that, in 2021, non-defense discretionary programs will be cut by 17 percent from last year’s baseline levels by the caps and sequestrations enacted in 2011. So Romney’s figures imply cuts of 14 percent or 25 percent (if Romney exempts Social Security and Medicare from these cuts) to non-defense discretionary programs on top of the substantial cut that is already set to take place.
What’s more, the above calculations – which I ran by several budget experts, just to make sure I had them right – are probably on the generous side. They don’t account for the impact of interest, which (for reasons I can explain in a separate post) are likely to require larger cuts. In addition, this is just a snapshot of 2016. The cuts to the big entitlement programs, particularly Medicare and Medicaid, would become larger in future years.
Still not convinced? Then keep in mind that Romney also supports a balanced budget amendment, which would likely require even steeper cuts than these calculations suggest, particularly if Romney were to cut taxes as promised (and thus reduce federal revenue).
So why don’t people recognize this proposal for the radical idea it is? One reason is that the Romney plan may be less severe than the ones other Republican presidential candidates have put forward. Santorum and Perry, for example, want to cap spending at 18 percent of GDP, while enacting larger tax cuts that and balanced budget requirements that would likely require even more drastic spending cuts.
But while Romney's spending cap may put him to the left of his presidential rivals, it puts him to the right of the Ryan and the House Budget Committee. Their budget would reduce non-defense spending in 2016 by $335 billion, or about 9.4 percent. That's a lot less than $500 billion and 14.1 percent. (We've seen this same phenomenon with other parts of the agenda, too: Although Romney's tax plan is less conservative than his rivals', he still gives big breaks to the wealthy, as Ezra Klein noted the other day.)
Embracing an agenda on the campaign trail and implementing it as president are wholly different things. Plenty of conservatives doubt Romney would live up to these commitments and, surely, a vow to cap federal spending at a fixed percentage of GDP is easier to break than a vow never to raise taxes. But, as the political scientist Jonathan Bernstein recently observed in the Washington Monthly, presidents have a funny way of following up on their promises and Romney, if elected, will probably have a Republican Congress pushing him to the right.
Maybe he'd really pursue these policies and maybe he wouldn't. Who knows. But should we really take that chance?
Update: In the first sentence, I changed "crippling" to "undermining," lest somebody accuse me of overstatement.
13 comments
Anything to the right of Ryan is simply unthinkable. Ryan is unthinkable. I get the feeling Romney thinks we are employees and can be fired, after all our wealth, such as it may be, is transferred to the "stockholders," which I guess is him and his buds in the 1%, about whom we are not to speak except quietly, behind closed doors. Envy, you know.
- Sophia
January 16, 2012 at 1:54am
Romney's desperate need to appeal to the loony Republican base is turning him into a Right wingnut. And he ain't turnin' back. If he became president, he'd be pulling phony stunts like G.W. Bush did about the renewal of Clinton's assault weapons ban. Bush saw that national polls strongly favored the ban, so he gave it lip service in public. Then, behind the scenes, he told Tom Delay to kill the renewal of the ban in committee. Delay did, and when asked why it didn't get out of committee, he said, "Well, it wouldn't have passed a House vote anyway." Democracy, Republican-Party-style, at work. President Romney would be pulling some of the same stunts that Bush did. Only Romney would be in league with the Tea Partiers, who are even crazier than Delay. And all the while he'd be giving lip service to sane policies, like Bush did. His Republican base wouldn't care what he said, as long as what he did or didn't do satisfied their extremist appetites.
- magboy47.
January 16, 2012 at 2:41am
Romney seems to be proposing a European style austerity program. First speaking French and now this. Oh horrors!
- paskunac
January 16, 2012 at 7:40am
And why not from a man who believes it is only proper to profit off the misfortunes of others? What I admire most (not) is his self interest in repealing the current estate tax on estates over $10 million dollars, which should save his kids at least $84 million. (Meanwhile he gave $50-$60 to a jobless woman with an ill son that they dragged to and gathered around at one of his events. He'll hand out dimes next.) We need more self serving politicians like Romney (not).
- Nusholtz
January 16, 2012 at 8:42am
Yeah, but he wants to get rid of the estate, er I mean death tax. Once we get rid of that the jobs will simply flow as we know longer discourage dying.
- MikeB.
January 16, 2012 at 10:27am
I guarantee that Romney will dispute these numbers and say that his policies will cause the economy to grow at such an accelerated rate that we can have our cake and eat it too. In fact, I promise his projections will be so rosy that he will add an extra tax cut for the rich(which itself will pay for itself) on top of all of this.
- blackton
January 16, 2012 at 10:45am
Jonathan: Thank you for ACTUALLY reading *Our Reluctant Savior/Willard Mitt Romney*'s plan. This is why I read TNR...
- mcmahon.an
January 16, 2012 at 10:59am
I don't doubt the analysis, and appreciate Mr. Cohn providing it. What I do doubt is the ability of the Democrats to make these numbers meaningful to the American electorate. After all, the only way that that these numbers will become public policy is if the people who will be harmed by the cuts put Mr. Romney in the White House. And it looks like they may well do so. That is what is meant by the polls that say that a majority of working class whites are likely to vote for Mr. Romney in the presidential election. If they want want to cut the programs designed to protect them, why not do so? If that results in a tax cut for me, I will take it.
- CABChi
January 16, 2012 at 11:10am
Fair enough, CABChi. The scenario we are talking about is definitely one of the likelier outcomes. "If they want want to cut the programs designed to protect them, why not do so?" I think we have a moral obligation to prevent that (disclaimer: I am employed in the third sector at an organization dedicated to protecting those programs, so I drank this cool-aid a LONG time ago...). True, it is very difficult to protect programs like this at a national level when not all of those in a position to benefit from these programs are willing to voice support for them. Then again, political outcomes aren't actually predictable. I will take my chances...
- mcmahon.an
January 16, 2012 at 1:13pm
I think (hope) that CABChi exaggerates. People will always say ‘yes’ to spending cuts in general; but frequently ‘yes’ changes to ‘no’ when asked about specific cuts. (The same is true about the Affordable Care Act. People dislike it, but like specific provisions when asked about them. The GOP has made the law unpopular but not the specific reforms.) Somehow Democrats must make people understand that with government, like everything else, you get what you pay for. If we want to buy a government like a ten year old car with 200.000 miles on it, then we will have a really bad government. Conservatives frequently hold up DMV’s as an example of bad government. Well, the number of drivers keeps increasing and states are cutting staff—so what do you expect to happen? Democrats must keep the discussion concrete. People must understand that big cuts will be made to specific programs and how that will affect them.
- Vekert
January 16, 2012 at 10:35pm
I am willing to believe all of that, Vekert. The problem is that I don't know of any practicable scheme to *make* people understand something that doesn't involve spending millions upon millions and retaining at least a few PR firms, etc., and calling in a few high level favors. I am not sure that those who bankroll liberal campaigns and causes think that the good government cause is worth their money. Perhaps that is a mistake, time will tell...
- mcmahon.an
January 16, 2012 at 10:53pm
It's difficult to fight the 24/7 Big Lie channel and its hate mongering ilk on the radio. Alas, Faux News, Limbaugh, et.al., have done their work and people now believe that up is down. On the other hand, maybe common sense will prevail? I hope so.
- Sophia
January 16, 2012 at 11:40pm
Paskunac, I greatly admire your ability to capture the logical thrust of an argument in one sentence. Mitt truly wants European-style austerity programs, just like what is happening now in Britain, Ireland, Italy, Spain and Greece, and with the same results -- no growth and increasing unemployment. Well done!
- wildboy
January 17, 2012 at 12:25pm