Big government on the brink

By Robert J. Samuelson
The Washington Post
http://www.washingtonpost.com/
April 11, 2011

We in America have created suicidal government; the threatened federal shutdown and stubborn budget deficits are but symptoms. By suicidal, I mean that government has promised more than it can realistically deliver and, as a result, repeatedly disappoints by providing less than people expect or jeopardizing what they already have. But government can’t easily correct its excesses, because Americans depend on it for so much that any effort to change the status arouses a firestorm of opposition that virtually ensures defeat. Government’s very expansion has brought it into disrepute, paralyzed politics and impeded it from acting in the national interest.

Few Americans realize the extent of their dependency. The Census Bureau reports that in 2009 almost half (46.2 percent) of the 300 million Americans received at least one federal benefit: 46.5 million, Social Security; 42.6 million, Medicare; 42.4 million, Medicaid; 36.1 million, food stamps; 3.2 million, veterans’ benefits; 12.4 million, housing subsidies. The census list doesn’t include tax breaks. Counting those, perhaps three-quarters or more of Americans receive some sizable government benefit. For example, about 22 percent of taxpayers benefit from the home mortgage interest deduction and 43 percent from the preferential treatment of employer-provided health insurance, says the nonpartisan Tax Policy Center.

“Once politics was about only a few things; today, it is about nearly everything,” writes the eminent political scientist James Q. Wilson in a recent collection of essays (“American Politics, Then and Now”). The concept of “vital national interest” is stretched. We deploy government casually to satisfy any mass desire, correct any perceived social shortcoming or remedy any market deficiency. What has abetted this political sprawl, notes Wilson, is the rising influence of “action intellectuals” — professors, pundits, “experts” — who provide respectable rationales for various political agendas.

The consequence is political overload: The system can no longer make choices, especially unpleasant choices, for the good of the nation as a whole. Public opinion is hopelessly muddled. Polls by the National Opinion Research Center at the University of Chicago consistently show Americans want more spending for education (74 percent), health care (60 percent), Social Security (57 percent) and, indeed, almost everything. By the same polls, between half and two-thirds of Americans regularly feel their taxes are too high; in 2010, a paltry 2 percent thought them too low. Big budget deficits follow logically; but of course, most Americans want those trimmed, too.

The trouble is that, despite superficial support for “deficit reduction” or “tax reform,” few Americans would surrender their own benefits, subsidies and tax breaks — a precondition for success. As a practical matter, most federal programs and tax breaks fall into one of two categories, each resistant to change.

The first includes big items (Social Security, the mortgage interest deduction) whose benefits are so large that any hint of cuts prompts massive opposition — or its specter. Practical politicians retreat. The second encompasses smaller programs (Amtrak, ethanol subsidies) that, though having a tiny budget effect, inspire fanatical devotion from their supporters. Just recently, for example, the documentary filmmaker Ken Burns defended culture subsidies (“an infinitesimally small fraction of the deficit”) in The Post. Politicians retreat; meager budget gains aren’t worth the disproportionate public vilification.

Well, if you can’t change big programs or small programs, what can you do? Not much.

If deficits were temporary — they were certainly justified to temper the recession — or small, they would be less worrisome. That was true for many years. No more. An aging population and uncontrolled health costs now create an ongoing and massive mismatch between spending and revenue, even at “full employment.” The great threat is a future debt crisis, with investors balking at buying all the Treasury bonds the government requires to operate. So President Obama and Congress face a dilemma: The more they seek to defuse the economic problem of too much debt, the greater the political risks they assume by cutting spending or raising taxes.

The package to prevent a shutdown barely touches the prevailing stalemate. House Budget Committee Chairman Paul Ryan’s proposed 2012 budget forthrightly addresses health spending but doesn’t make any cuts in Social Security. Ryan’s plan would ultimately gut defense and some valuable domestic programs; it wouldn’t reach balance until about 2040. Compared with Democrats, however, Ryan is a model of intellectual rigor and political courage. Obama would run huge deficits from now to eternity; the Congressional Budget Office has projected about $12 trillion of added debt from 2010 to 2021 under his policies. Obama urges an “adult” conversation and acts like a child, denying the unappealing choices.

Government is suicidal because it breeds expectations that cannot be met. All the partisan skirmishing over who gets credit for averting a shutdown misses the larger issue: whether we can restore government as an instrument of progress or whether it remains — as it is now — a threat.