Thursday, February 17, 2011

Will you help pay for it?

The massive federal budget landed with a thud, with complaints incoming from all sides. The White House has provided a nifty interactive graphic of where the money goes (in 31 categories). Run your mouse over a box to see its percentage of the total. Yes, Social Security, Health Care (Medicare & Medicaid), National Security, and Income Security are the biggest parts of the budget. It's cool that the White House provided it.

Some commentary:

Ari Ezra Waldman, law professor, notes that all (at least American) federal budgets incentivize -- coerce -- behavior. Even the ones put out by Tea Party members, though they may try to deny it. Yes, the behavior outcomes will be different in each case.

Coercion comes in several forms: Farm supports to plant this crop or that one. Reduced taxes for buying a house. Reduced taxes for marriage. Support for clean energy (or the GOP support for coal).

We've long ago established that the American federal budget can coerce behavior. The questions now before us: Are we incentivizing the right things? Yes, that depends on who you ask. Does the incentive achieve the desired goal at an acceptable cost?

It appears that in this budget Obama is taking that last question seriously, something presidents haven't done before. For example, Obama is funding the Ryan White Act, a drug treatment and HIV/AIDS program that is known to work. He is also getting a lot of change for his buck through the Race to the Top and similar programs. 40 states changed education policies though only 12 states received grants. Similar programs are proposed for electric vehicle infrastructure, juvenile justice, and a host of other goals.

I agree this is a good way to guide the country.

Scott Horsley of NPR reports on studies by the Pew Research Center of American's views of the federal budget. On questions something like, "Do you think the government should do ____?" The answer was frequently yes. On questions like, "Do you think the government should do _____ and you help pay for it?" The answer was much more likely to be no. Which means: We like what the government does for us. We don't want to pay for it. That makes me wonder. Is the public aversion to taxes because the GOP has trumpeted low taxes for the last 25 years? Would the public opinion be different if our leaders preached fiscal responsibility that while these various programs are great we citizens must do our part for the common good and pay taxes to cover these expenses? Was that how it was done before Reagan?

I was annoyed to hear that Obama is proposing to chop programs from the discretionary part of the budget, in particular the home heating credit. It seems the GOP has convinced him that the poor should take the hit for the sake of a balanced budget. Is there a more effective way to do the same thing? Obama hasn't said loud enough for me to hear.

Steve Inskeep of NPR interviewed Alan Simpson, who headed the commission to find ways to reduce the budget. He is also annoyed with Obama's plan. According to the commission's report, cutting the all those discretionary programs that help the poor and keep the government running won't ever be enough to fix the deficit. If the big ones -- Medicare, Medicaid, defense, Social Security -- are addressed, then all those other little programs won't need to be touched (revising them for effectiveness is another matter).

I am pleased to see the GOP in the House agreed with Obama, Sec. Defense Gates, and the Joint Chiefs to kill an expensive alternate engine for a fighter plane. Even better, they did it even though Boehner's district would benefit.

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