Kevin Williamson of National Review Online explains major challenges linked to plans to fix the federal budget.
Getting fiscal policy right is — should be — a top-tier priority. But the congressional budget committees are, strangely enough, a frustrating base of operations for doing that.
The problem for fiscal hawks on the budget committees is that the budget covers only about one-third of all federal spending, the “discretionary” outlays, which are subject to the appropriations process. The other two-thirds of the budget is so-called mandatory spending: Social Security, Medicare and other entitlements, farm programs, interest on the debt, etc. Entitlements are called entitlements because, under the law, recipients are legally entitled to certain benefits as determined by statute. Congressional budget writers cannot simply knock 5 percent off of Social Security in the next year’s budget — if you want to change what’s spent on an entitlement, you have to change the law, not just the budget. …
… The House budget also includes “reconciliation instructions” for deficit-neutral tax reform. Translated from the Washingtonian, that means that if the budget is enacted not through regular legislative order but through the reconciliation process — which it almost certainly will be — then any tax reform that makes it into the final deal has to be designed in such a way that it does not add to the deficit.
The Senate has other plans. The upper chamber wants to enact massive tax cuts that would add $1.5 trillion — note the “T” — to the deficit.
