Successful parasites like leeches and tapeworms have evolved to live with their hosts, not kill them. The reason is obvious: Once the host perishes, the parasite loses its source of nutrition, and it dies, too. It is a lesson that the lobbyists, the special pleaders and the other bloodsuckers in Washington have yet to learn. Rather than work with Republicans to reduce spending and deficits, the Senate and the Obama administration are mobilizing to halt GOP-proposed budget cuts that would keep the federal government alive at least a few years longer.
It’s not as if Republicans are proposing anything radical. House GOP leaders already have backed off their campaign promise to cut $100 billion from the $3.7 trillion fiscal 2011 budget - about one-tenth of what is needed to balance the budget over the course of a business cycle. “We’re a third of the way through the fiscal year,” say these supposed flint hearts, “so we really can’t cut more than $60 billion or so in 2011 - but we’ll get to the full $100 billion in fiscal 2012.”
But even this pitiful effort to rein in total spending by less than 2 percent is too much for Senate Democrats to bear. An e-mail obtained by ABC News Friday revealed how a top staffer on a key Senate Appropriations subcommittee mobilized lobbyists and special-interest groups that might be affected by reductions to the Departments of Labor and Health and Human Services. The Jan. 24 meeting, which drew about 400 people, served as a “call to arms” for foes of the budget cuts.
“One thing everyone should be able to agree on now is that a rising tide lifts all boats and that a higher allocation improves the chances for every stakeholder group to receive more funding,” wrote the committee staff member for Sen. Tom Harkin, Iowa Democrat.
Working in tandem with Senate Democrats, President Obama delivered a State of the Union address last month that could have been composed on another planet. He trotted out a variety of spending initiatives, such as more money for education, high-speed rail, broadband Internet access and green technologies. He didn’t detail any spending cuts worth mentioning.
In sum, our leaders in Washington are acting like rats on the Titanic fighting over the table scraps while the AAA-rated - make that “unsinkable” - passenger liner slipped beneath the briny waves. The federal government is expected to run a record deficit of nearly $1.5 trillion this year. The interest on that new debt (if it were all financed at the 3.4 percent rate now prevailing for 10-year Treasury notes) would amount to $50 billion yearly. By the end of the decade, when interest rates are expected to be higher, the debt burden on just that one year’s debt will grow to $80 billion a year - more than the total spending cuts Republicans are hoping to enact this year and Democrats are hoping to thwart.
Between the escalating national debt and rising interest rates, interest payments on the debt are adding to the budget faster than we can cut. In time, those interest payments will crowd out the very programs the Democrats are defending. But instead of pruning programs thoughtfully while there is time to deliberate, they are putting off the day of reckoning to when the mother of all financial crises panics Congress into making decisions helter-skelter. In so doing, the Democrats ensure a frightful future for the very constituencies they seek to protect.
A few people in Washington see this outcome clearly. “Is there any hope,” plaintively asks Rudolph G. Penner, a budget analyst with the Urban Institute, in his recently published essay “Will It Take a Crisis to Fix Fiscal Policy?” Gloomily, he writes:
“Using a reasonable definition of current policy, the Congressional Budget Office (CBO, 2010) projects that the national debt in the hands of the public will reach 185 percent of the Gross Domestic Product (GDP) by 2035. Of course, those buying our debt will likely go on strike long before we reach that point.”
An investor strike will collapse the dollar, send interest rates spiking higher, bring about economic calamity and ravage political constituencies dependent upon federal largesse. Washington’s political class, which has affixed itself lampreylike to the body politic, cannot conceive of such an outcome. Fixated on the here and now, political parasites care nothing for the damage they inflict upon their hosts. But unlike nonhuman parasites, congressmen are blessed with brains and the gift of foresight. They have no excuse.
James A. Bacon is author of “Boomergeddon” (Oaklea Press, 2010) and publisher of the Wonk Salon blog (thewonksalon.com).