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Thursday, October 18, 2007
Letting the Process Fit The Politics
Inclusion(ist?) has up an interesting paper about the need to reform the budget process. Its thesis is that the budget process has been structured in a way that has successfully prioritized deficit reduction, and that these rules have focused attention more on the price of spending than its value.
I won't engage the specifics of the proposal to reform the budget process. But I think it makes an important point about budget politics and process. Coincidentally, it echoes the imitable Stan Collender in his column this week:
There has been strong political pressure in the United States to reduce the deficit for at least the past two decades. Eliminating the deficit became a formal requirement in the mid-1980s when Gramm-Rudman-Hollings made reducing the deficit the government's explicitly stated policy. While no longer required, it has been a political imperative ever since GRH and its successors were allowed to expire.
If Stan Collender says it, it must be true: budget politics have centered around the deficit. But its arguable that the budget process is the cause of this focus. As Collender points up, deficits remained central well after a tule aimed at reducing the deficit lapsed.
Similarly, conservative demand for passing enormous tax cuts probably came before the changes to PAYGO rules. Once they were in power, they changed the rules to promote their preferences. The Democrats have restored PAYGO rules, most likely because they wanted to make sure that they would pass deficit-neutral legislation. If process determined policy, the Democrats would not have acted any differently than the Republicans, and wouldn't have made the budget process changes they did.
Anyway, I find it more convincing that budget process rules follow, rather than precede, a change in the political climate. That's not to say they don't have a strong influence on policy; without PAYGO rules, I find it hard to imagine that every mandatory spending and tax bill would have been offset.
But is deficit reduction still that what people want from government? It reminds me of something Sen. Chuck Schumer (D-NY) said in the New York Times last week:
It's just as clear that Democrats think that the political game has changed. Pay for most workers has been growing only a little faster than inflation over the last five years, and except for the late 1990s hasn't really done well since the early 1970s. Inequality has returned to the levels of the 1920s.
''It's an economy that demands more from our workers and gives less in return,'' Hillary Clinton said in Iowa this week, on her Middle Class Express bus tour. As Charles Schumer, New York's other senator, told me earlier this year: ''In the past, the attitude was, 'Get government out of the way.' And now it's, 'Gee, I may need it.' ''
If Schumer and Clinton, two centrists if there ever were any, are correct, we need to start talking about how to change the budget process to ensure that the public gets what it wants. Once deficit reduction is no longer the public's chief fiscal goal, it seems appropriate to make the budget process facilitate spending. This paper's a good place to begin that conversation.
Posted by Matt Lewis
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