WHERE'S THE BEEF IN BUDGET CUTS?
May 21, 1997
President Clinton's inaugural address declared the era of big government spending was over. According to economists, however, the latest budget deal proves it is not:
- The budget deal achieves only half of the deficit reduction of the 1990 deal, and the latter produced higher spending.
- Compared to the 1993 Clinton targets --which also led to higher spending -- the latest proposal envisions 40 percent less in savings.
The little savings the budget deal would achieve are in the out years and bogus, according to analysts:
- More than half of the savings come after the year 2000.
- Much of the savings were achieved by increasing the "baseline budget," like doubling the price of a pair of shoes and advertising a 50 percent cut off the listed price.
Economists observe, however, the budget deal does effectively achieve one goal, higher spending:
- Under the five-year plan, domestic discretionary spending will increase by $70 billion, for programs such as foreign aid, corporate welfare, and the National Endowment for the Arts (NEA).
- This budget deal delivers $80 billion more in domestic outlays than Clinton's last budget.
- Domestic outlays have already increased from $622 billion to $1.1 trillion over the last decade, according to economist Steve Moore of the Cato Institute.
One positive aspect of the deal is that it does not raise taxes on net. Yet according to analysts, because of hikes in some levies, total tax cuts come to only $50 billion, a fraction of Clinton's 1993 hikes and less than 1 percent of federal revenues over the five-year plan.
Source: Daniel Bandow (Cato Institute), "Future Furies Spinning off from the Deal," Washington Times, May 21, 1997.
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