March 02, 2010

Will the USS Budget Go Down? A Titanic Budget in an Ocean of Icebergs

Jo Comerford of the National Priorities Project on the proposed US budget: "Send up a flare! The 2011 federal budget has sprung some leaks in the midst of a storm. Not sure there's enough money for life rafts! Forget women and children first!"

"Buffeted by economic hard times, the 2,585-page, $3.8 trillion document is already taking on water, though this won't be obvious to you if you're reading the mainstream media. Let's start with the absolute basics: 59% of the budget's spending is dedicated to mandatory programs like Medicaid, Medicare, Unemployment Insurance, Social Security, and now Pell Grants; 34% is to be spent on "discretionary programs," including education, transportation, housing, and the military; 7% will be used to service the national debt.

A serious look at this budget document reveals some "leaks" -- two in actual spending practices and two in the basic assumptions that undergird the budget itself. Ship-shape as it may look on the surface, this is a budget perilously close to an iceberg, and it's not clear whether the captain of the ship will heed the obvious warning signs.

Whose Security Is This Anyway?

..."Within the context of the total budget ... so-called non-security discretionary spending represents a mere 11% of proposed 2011 spending. In other words, Obama’s present plans to chip away at the debt involve leaving 89% of the budget untouched.  Only the $370 billion going to myriad domestic social programs will be on the chopping block.

What's in that $370 billion? Well, for starters, programs that focus on the environment, energy, and science. In the 2011 budget, these categories combined are projected to receive $79 billion or 6% of total domestic discretionary spending. Though each of these areas could actually use a significant boost in funds, that’s obviously not in the cards -- and this will translate into less money at the state level.  New York, for example, is projected to receive $247 million in home energy assistance for low-income folks, down more than $230 million from 2010. These funds mean an energy safety net for our communities, and also warmth and jobs in a cold winter, which looks like “security” to most of us, no matter what our captain says.

Asking for disproportionate cuts and efficiencies in programs in only 11% percent of the overall budget might perhaps be slightly easier to stomach if military spending wasn’t allowed relatively free rein in 2011 (and thereafter). The NPP estimates, in fact, that aggregated increases in military spending over the next decade will exceed $500 billion, drowning twice-over the projected $250 billion in non-security discretionary savings from the president’s cuts over the same time period. Consider this visible unwillingness to control military-related spending leak two in our budgetary Titanic.

By now, danger flags should be going up in profusion because the second leak is so familiar, so George W. Bush. With each new bit of information, in fact, it sounds more and more like the same old song, the last guy's tune. It’s clear that, as soon as the stimulus bump wears off later this year, we're in danger of falling back into exactly the same more-money-for-the-military, less-federal-aid-to-the-states rut we’ve been in for years, despite strong statements from both President Obama and Defense Secretary Robert Gates decrying Pentagon waste.

And speaking of waste, the Department of Defense is currently carrying weapons-program cost overruns for 96 of its major weapons programs totaling $295 billion, which alone are guaranteed to wipe out any proposed savings from President Obama's non-security discretionary freeze, with $45 billion to spare. That's only to be expected, since neither the Pentagon nor any of the armed services have ever been able to pass a proper audit. Ever.

If they had, what would have become of the C-17, the Air Force's giant cargo plane? With a price tag now approaching $330 million per plane and a total program cost of well over $65 billion, the C-17, produced by weapons-maker Boeing, has miraculously evaded every attempt to squash it. In fact, Congress even included $2.5 billion in the 2010 budget for ten C-17s that the Pentagon hadn’t requested.

Keep in mind that $2.5 billion is a lot of money, especially when cuts to domestic spending are threatened. It could, for instance, provide an estimated 141,681 children and adults with health care for one year and pay the salaries of 6,138 public safety officers, 4,649 music and art teachers, and 4,568 elementary school teachers for that same year. Having done that, it could still fund 22,610 scholarships for university students, provide 46,130 students the maximum Pell Grant of $5,550 for the college of their choice, allow for the building of 1,877 affordable housing units, and provide 382,879 homes with renewable electricity -- again for that same year -- and enough money would be left over to carve out 29,630 free Head Start places for kids. That’s for ten giant transport planes that the military isn’t even asking for.

Domestic-spending freeze proponents demand that our $13 trillion national debt, accumulated over seven decades, be turned back starting now. Critics of Obama’s freeze remind us that, while the C-17 flourishes, cutting into that domestic 11% is like trying to get blood from a stone. They argue that what we need in recessionary times is an infusion of strategic domestic spending. They tend to cite Mark Zandi, chief economist for Moody’s Economy.com, who has noted that, for every dollar in stimulus aid directed toward the states, $1.40 returns to the economy, while every dollar invested in infrastructure spending yields $1.60."...

Read full article, published March 1, 2010 by TomDispatch.com

Jo Comerford is the executive director of the National Priorities Project.