George F. Will: Shrillness of fiscal cliff talk bewitches minds
Charles Dharapak, File, Associated Press
WASHINGTON — Even Jonathan Swift, who said promises and pie crusts are made to be broken, might have marveled at the limited shelf life of Barack Obama's promise of a "balanced" deficit-reduction plan — substantial spending cuts to accompany revenue increases. Obama made short shrift of that promise when he demanded $1.6 trillion in immediate tax increases and mostly unspecified domestic cuts. He also promised to cut $800 billion from 10 years of war spending that will end in two years, which is like "cutting" $800 billion by deciding not to build a ski resort on Mars.
Year after year, the Democratic-controlled Senate, ignoring the law, refuses to pass budgets. Year after year, Washington makes big government cheap by charging Americans only $6 for every $10 of government services, borrowing the difference. And the biggest purchaser of U.S. government debt is not China but ... the U.S. government, largely through the Federal Reserve. Yet what supposedly is horrifying is a sequester that would cut less than 3 percent of federal spending over the next decade?
Or horrible Grover Norquist. Although a surfeit of numbers are being bandied, a pertinent one is missing — the number of legislators who have pledged to Norquist not to raise taxes. The number is: Zero. All pledges have been to voters. Progressives lament the public's distrust of the political class, while urging many members of it to treat their promises as pie crusts.
Given progressives' "principled" refusal to countenance entitlement reforms, the principal drivers of the fiscal imbalance will not be untouched even by raising, from 65, the age of Medicare eligibility. In 1965, the year this program was created, the average life expectancies of men and women at age 65 were another 13.5 and 18 years respectively. Today they are 19 and 21, and rising. Given modern medical — especially pharmacological — marvels, longevity often involves living with several chronic ailments that might have been fatal a generation ago. For liberals, however, no demographic or scientific changes need be accommodated.
Democrats insist the manufactured unpleasantness due Jan. 1 is a crisis of insufficient revenues. But Jeffrey Dorfman, a University of Georgia economics professor, thinks arithmetic says otherwise. Writing for RealClearMarkets, he says possible tax increases and spending cuts would reduce the current deficit by less than a third, leaving a deficit larger than any run by any president not named Obama.
At the end of the Clinton administration, when the budget was balanced (largely by revenues generated by commercialization of the Internet), annual federal spending was $1.94 trillion and revenue was $2.10 trillion. "Adjusting for inflation and population growth since the start of 2001," Dorfman writes, "today's equivalents would be $2.77 trillion and $3.00 trillion," and a $230 billion surplus.
What is to blame for today's huge imbalance? The Bush tax cuts? The recession? Obama's spending? Dorfman answers yes, yes and yes — but that "spending is the main culprit" because: Today federal revenue is $2.67 trillion (slightly less than "the Clinton equivalent") and spending is $3.76 trillion, so we are spending $987 billion more than we would be if we had just increased Bill Clinton's last budget for inflation and population growth.
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