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Sunday, February 27, 2011

Will people be upset over budget cuts?

I watched an interesting panel discussion on FNS today about whether or not the American people would "freak out" over the budget cuts being proposed by the Republicans. Not surprisingly, the panel was split with Democrats saying "yes", and Republicans saying "no." So long as the true nature of the spending reductions ets through the haze of the media, however, there is little question that the public would go along with them.

First, the "draconian" cuts lamented by the Democrats do not even take the federal spending levels back to those of 2008, a year when most people already thought that spending was out of control. In other words, spending will go from extraordinarily lavish levels to just plain lavish levels.

Second, big chunks of the cuts are for things that have no real constituency. Just how many people will care if the budget of the IRS is cut? Will there be an uproar if the EPA has to exist on a budget only 15% bigger than it had two years ago (to do the same job)? Is there really great support for agricultural subsidies at a point when nearly all farm products are selling at prices much higher than at any time in recent years? (Sure, the farmers directly affected want the subsidies to continue, but who else does?) Who is concerned if the department of Energy has to cut its budget by 35%? Indeed, who can name one thing that the Department of Energy has accomplished in the last two years? Let me rephrase that: who can name one GOOD thing that the Department of Energy has accomplished in the last two years? (We all know that Energy was involved in dealing with the BP well blowout and handled it in the most incompetent possible manner.) Let me just say "Commerce Department" and wait for the howls of the folks who are the ardent supporters of that organization.

I could go on, but the point is clear. No one is talking about cutting the Defense Department funding for the war in Afghanistan. No one is talking about cutting funding for Social Security or Medicare. No one is talking about cutting any of the real safety net for the poor. If ten thousand federal employees lose their jobs, it is just a blip on an unemployment picture in which millions remain unemployed. Those federal employees are a rounding error at best.

In short, other than those who will directly suffer from the cuts (and that is mostly a few federal employees), there is simply no one who is going to get upset about returning the level of federal spending closer to reality. Everyone knows that the choice is between cutting back now or going bankrupt later.

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