No Free Lunch for You

On May 17, 2012, Mitt Romney said a few things that finally surfaced on September 17, 2012, when excerpts from a video recorded on hidden camera were published by Mother Jones. Romney, speaking at a private fifty-grand-a-plate fundraiser at hedge fund manager Marc Leder’s mansion in Boca Raton, was caught on tape saying that forty-seven percent of Americans are useless parasites, who think the government owes them something, as if this is some sort of cooperative where everyone chips in to cover those who run into trouble, when these losers should take care of themselves, damn it. They have no sense of personal responsibility and never will have – they are simply morally inadequate. Maybe they were born that way. There was no point in trying to get their vote. He didn’t want their vote anyway.

Those remarks were meant to be private, but it’s just as well that they surfaced and were discussed endlessly. They clarified matters. One side did hold that government is not some sort of cooperative where everyone chips in to cover those who run into trouble. It can’t be, if freedom means anything at all. Government exists to provide the freedom to succeed, or fail, and then gets out of the way – or it should. There’s no free lunch. Deal with it.

Obama, however, had run on the idea that our government really is sort of cooperative where everyone chips in to cover those who run into trouble – we’ve got each other’s backs. He’d been saying that since 2004 when he delivered the keynote address at the Democratic convention in Boston, where John Kerry was nominated. Some called that socialism, the most evil thing any American could ever propose, while others called it patriotism and a sense of community, a sense that we’re one people, almost family perhaps.

Obama won that argument in 2008, but the nation was still split on that. Four years later, Romney’s comments on that one odd evening, made in private, made the two ways of looking at government explicit. Romney tried to walk those comments back a bit but got all tongue-tied the more he tried. He wasn’t heartless. He understood that “those people” were in trouble. He’d make sure they got jobs, or something, but the damage was done. It’s hard to go back and obfuscate what you just made quite clear.

Romney’s gripe was with the loathsome forty-seven percent, the poor and working poor who paid no federal income tax – the morally reprehensible takers. It wasn’t fair. The people who had made something of their lives had to pay for everything, and it was time for the “takers” to pay up. The people who had made something of their lives were getting ripped off. This was theft from the job creators, the makers, the doers – the morally responsible folks who had been rewarded for their moral responsibility with the hard-earned comforts of life. That had to stop. Ayn Rand said so. And Mitt Romney lost the election.

This argument will never end, of course, because it’s being made again:

The Trump administration is billing its budget as a plan to “reform the welfare system” and replace “dependency with dignity of work,” while saving $274 billion over 10 years, according to a four-page memo obtained by POLITICO.

The White House budget, to be released Tuesday, will suggest taking an ax to safety net programs like food stamps and popular family benefits like the child tax credit, in order to achieve the ambitious goal of balancing the federal budget over a decade.

So, morally reprehensible dependency will be replaced by the dignity of work, assuming there are jobs for everyone, and on schedule, the budget was released:

President Trump on Tuesday proposed dramatic changes to the role of the federal government, issuing a budget plan that culls or eliminates numerous programs that the White House says are a waste of money or create too much dependency.

Some of these programs – including Medicaid and the modern version of food stamps – provide benefits to up to a fifth of all Americans, and the breadth of the cuts has rattled lawmakers from both parties who have warned that the reductions go too far.

For Trump, his $4.094 trillion budget proposal for the fiscal year that begins in October marks his first exercise in spelling out – in great detail – how he wants the government to change. White House Office of Management and Budget Director Mick Mulvaney called the plan a “Taxpayer First Budget,” and he said they worked to jettison any spending that they felt they could not defend. In total, this meant roughly $3.6 trillion in cuts over the next 10 years.

That’s the Romney argument, framed as Taxpayers First – the makers not the takers – but all will be just fine:

These cuts, White House officials said, would usher in a sustained period of strong economic growth that would increase wealth, create more jobs and reduce poverty.

And in the meantime:

Funding for Medicaid, the health-care program for low-income Americans and many people in nursing homes, would be cut by more than $800 billion over 10 years. Funding for the Supplemental Nutrition Assistance Program, a modern version of food stamps that provided benefits to 44 million people in 2016, would be cut 29 percent. In many cases, a higher burden of paying for anti-poverty programs would be shifted away from the federal government and onto the states.

Mulvaney said too many of these programs spend other people’s money. He said the government should show “compassion” for low-income Americans but it should “also have compassion for folks who are paying for it.”

Call it Romney’s Revenge, or like Jamelle Bouie, call it a scam just like Trump University:

If you followed Trump’s presidential campaign, you might assume that his budget would reflect his promise to put “America first,” with a focus on ordinary people and their needs. Indeed, along with attacks on Muslims and immigrants, Trump made specific promises: That he would provide cheaper, more comprehensive health care; that he would protect Social Security, Medicare, and Medicaid; that he would raise wages and provide new jobs. People believed him, and millions backed his campaign, confident that he would steer government for their benefit.

This was a scam too. There is no relief coming. No help with health care or jobs. Instead, if Trump and his team could govern by fiat, they would siphon trillions of dollars from the federal government to fill the coffers of the wealthiest people in the country, breaking his promises and immiserating millions of low-income and working Americans of all political stripes.

That’s out there in plain sight:

President Trump’s budget includes roughly $2.5 trillion in cuts to anti-poverty programs, spaced out over a 10-year period. The Supplemental Nutrition Assistance Program – otherwise known as “food stamps” – loses $191 billion. Between the Republican health plan – included in the proposal – and a set of additional cuts that reduce eligibility and shrink year-over-year funding, Medicaid loses nearly $1.5 trillion, or just more than 47 percent of its budget over the next decade, an unfathomable blow to low-income families, children, and the elderly.

There’s that forty-seven percent again and then there’s this:

The earned income tax credit and child tax credit – which provide needed relief to millions of working families – lose $40.4 billion. Temporary Assistance for Needy Families, “welfare,” loses $21.6 billion, further slashing an already stingy and tough-minded program. Disability insurance and Supplemental Security Income, two key parts of Social Security that provide assistance to poor seniors and people with disabilities, lose $72 billion. On top of all of this, Trump’s budget makes substantial cuts to job-training programs, rental assistance, heating assistance for the elderly, education, and projects at the Centers for Disease Control and Prevention, as well as funding for rural health and substance-abuse programs. It doesn’t just slash the social safety net; it douses it in fuel and sets it ablaze.

And of course this is a Tea Party thing:

Trump’s budget is the brainchild of Mick Mulvaney, director of the White House Office of Management and Budget. Prior to his service in the administration, Mulvaney was a congressman, representing the 5th District of South Carolina and leading the House Freedom Caucus, which he co-founded. More than anything else, this proposal reflects the cruel, Ayn Randian ideology that animates the Freedom Caucus and the larger Tea Party movement. To use the language of a somewhat younger Paul Ryan, it takes from “takers” and gives to “makers,” a fact Mulvaney neither hides nor shies away from.

“This is, I think, the first time in a long time that an administration has written a budget through the eyes of the people who are actually paying the taxes,” he said.

Somewhere, in Utah or out here in La Jolla, Mitt Romney is smiling:

Every working American contributes to the federal government, whether through payroll taxes or income taxes. But Trump and Mulvaney’s plan is to relieve the wealthy of their share. Next to the cuts, the centerpiece of this budget is a $3 trillion to $7 trillion tax cut for the richest Americans that lowers the individual rate, repeals taxes on investment income, ends the alternative minimum tax – which limits the deductions wealthy people can take – and slashes corporate taxes, as well as creating a massive new loophole for wealthy owners of partnerships and “sole proprietorships,” like incidentally, Donald Trump.

This may be classic scam:

Millions of Americans cast their ballots in November thinking they’d get the best possible “deal” from a hard-charging president who cares about people like them. What they will receive – or at least, what he wants to offer – is highway robbery. He will pick their pockets to give benefits to his wealthy backers. It is shocking, but it’s not a surprise. This is who Trump was when he ripped off his contractors; it was who he was when sold a scam university to hopeful, desperate people; and it is who he is as president of the United States. Unfortunately, we now have to live with it.

Jordan Weissmann, however, doesn’t blame Trump:

For starters, there’s a good chance our president doesn’t really understand the contents of the proposal going out under his name – recall that this is the man who couldn’t even be bothered to learn what was in the House healthcare bill he lobbied for. Trump won’t even be in the country when the budget is released. While that may just be a timing coincidence, it also feels aptly symbolic of the president’s personal investment in the proposal. It seems highly unlikely he truly cares much about whether most of the budget’s contents pass.

You might instead think of Trump’s first full budget – as is traditional for new administrations, the White House released a partial “skinny budget” in March – as a permission slip. It is essentially a stack of papers telling Republicans that they are free to go wild butchering essential pieces of the safety net in order to fund extraordinary tax cuts for the wealthy and increased defense spending…

He’s granting Paul Ryan permission to cut away. And that, ultimately, is what makes Trump’s budget so frightening. Even if the whole package probably isn’t going to become a reality, it’s still a sign that he won’t stop Republicans enacting whatever rash part of their agenda they manage to legislate. And while they may be more hesitant to pass dramatic cuts to some programs now that they’re actually in power and liable to suffer the electoral consequences – many come from farm states that tend to like food stamp spending, for instance – the GOP now has an empty suit in the oval office who’s apparently willing to bring their most extreme ideas to life. He might not even bother to read them first.

No one seems to have read this idea, as Jonathan Chait points out a problem with the basic math:

Trump has promised to enact “the biggest tax cut in history.” Trump’s administration has insisted, however, that the largest tax cut in history will not reduce revenue, because it will unleash growth. That is itself a wildly fanciful assumption. But that assumption has already become a baseline of the administration’s budget math. Trump’s budget assumes the historically YUGE tax cuts will not lose any revenue for this reason – the added growth it will supposedly generate will make up for all the lost revenue.

But then the budget assumes $2 trillion in higher revenue from growth in order to achieve balance after ten years. So the $2 trillion from higher growth is a double-count. It pays for the Trump cuts, and then it pays again for balancing the budget. Or, alternatively, Trump could be assuming that his tax cuts will not only pay for themselves but generate $2 trillion in higher revenue. But Trump has not claimed his tax cuts will recoup more than 100 percent of their lost revenue, so it’s simply an embarrassing mistake.

Mick Mulvaney now says he’ll look into that, but Chait Is not impressed:

It seems difficult to imagine how this administration could figure out how to design and pass a tax cut that could pay for itself when Ronald Reagan and George W. Bush failed to come anywhere close to doing so. If there is a group of economic minds with the special genius to accomplish this historically unprecedented feat, it is probably not the fiscal minds who just made a $2 trillion basic arithmetic error.

Ah, but there is another group of economic minds:

More than 35 American economists surveyed last week by the University of Chicago Booth School of Business disagree with a basic element of President Trump’s proposed tax plan: whether it will pay for itself. In an unusual display of unity, 100 percent of participating economists rejected the idea this week that Trump’s plans to drastically lower taxes on corporations, business, and individuals will create enough economic growth to offset the lost federal revenue and avoid adding to the national debt.

Michael Grunwald puts that a bit more colorfully:

I have a plan to dunk a basketball. First, I’ll grow a foot taller. Next, I’ll recapture the athleticism of my youth, so I can jump a lot higher. I didn’t say I had a serious plan – just a plan.

Today, the Trump administration released a plan to balance the federal budget over the next decade, and it’s no more plausible than my plan to become LeBron James. It does reveal the administration’s fiscal priorities, like deep cuts in spending on the less fortunate and the environment, no cuts to Medicare or Social Security retirement benefits, steady increases in spending on the military and the border, and an abiding faith in the restorative miracles of tax cuts for corporations and well-off families. But its claim to a balanced bottom line is based on a variety of heroic assumptions and hide-the-ball evasions, obscuring trillions of dollars’ worth of debt that it could pile onto America’s credit card.

That is an issue:

Budget proposals always involve some guesswork into the unknowable, and administrations routinely massage numbers to their political advantage. But this proposal is unusually brazen in its defiance of basic math, and in its accounting discrepancies amounting to trillions-with-a-t rather than mere millions or billions. One maneuver in President Donald Trump’s budget arguably waves away an estimated $5.5 trillion in additions to the national debt from tax cuts, nearly $20,000 for every American alive today, enough to fund the Environmental Protection Agency at current spending levels for nearly 700 years. Trump critics in the budget-wonk world are pointing to another $2 trillion of red ink as a blatant math error – or, less charitably, as an Enron-style accounting fraud.

Or it’s something else:

Ultimately, the Trump budget reads like a corporate prospectus for a shady widget manufacturer who claims that cutting widget prices will spark a massive surge in widget sales, while also promising major cutbacks in ineffective widget salesmen and unnecessary widget costs. It doesn’t pencil out. And it’s worth understanding the main reasons it doesn’t pencil out, because soon Republicans in Congress will get to use their own pencils.

Sure, but Republicans in Congress have whipped out their pencils – stop giggling at that image – and cannot make this work:

President Trump’s proposal to cut federal spending by more than $3.6 trillion over the next decade – including deep reductions for programs that help the poor – faced harsh criticism in Congress on Tuesday, where even many Republicans said the White House had gone too far.

While some fiscally conservative lawmakers, particularly in the House, found a lot to praise in Trump’s plan to balance the budget within 10 years, most Republicans flatly rejected the White House proposal. The divide sets up a clash between House conservatives and a growing number of Senate Republicans who would rather work with Democrats on a spending deal than entertain Trump’s deep cuts.

“This is kind of the game,” said Senate Majority Whip John Cornyn (R-Tex.). “We know that the president’s budget won’t pass as proposed.”

Horrors! They’re willing if not eager to work with Democrats on all this, because there are real horrors here:

Rep. Mark Meadows (N.C.), chairman of the hardline Freedom Caucus, said he was encouraged by early reports of new curbs on food stamps, family welfare and other spending. But he said he draws the line on cuts to Meals on Wheels, a charity that Mulvaney earlier this year suggested was ineffective.

“I’ve delivered meals to a lot of people that perhaps it’s their only hot meal of the day,” Meadows said. “And so I’m sure there’s going to be some give and take, but to throw out the entire budget just because you disagree with some of the principles would be inappropriate.”

There is going to be some give and take:

Sen. Lindsey Graham (R-S.C.) said he backs Trump’s proposal for a temporary burst of new defense spending, which White House officials say would allow them to add 56,400 service members in 2018. But he worries that Trump would finance those increases by cutting critical programs like the National Institutes of Health.

“My number one goal is to have a more balanced budget,” said Graham, who also endorsed the idea of entering into spending talks with Democrats. “NIH is a national treasure, and it would be hurt, too.”

These two sound like Mitt Romney five years ago. He walked back that forty-seven percent thing. He wasn’t heartless. He understood that “those people” were in trouble. Say there’s no free lunch and some people will starve. Basic medical research into diseases that could kill us all, that private industry won’t do because there’s no money to be made in the generalized basic underlying research, is a good thing too. There are makers and takers – there always will be – but there’s common sense and common decency. Obama actually won that argument long ago. Donald Trump is about to discover that.

About Alan

The editor is a former systems manager for a large California-based HMO, and a former senior systems manager for Northrop, Hughes-Raytheon, Computer Sciences Corporation, Perot Systems and other such organizations. One position was managing the financial and payroll systems for a large hospital chain. And somewhere in there was a two-year stint in Canada running the systems shop at a General Motors locomotive factory - in London, Ontario. That explains Canadian matters scattered through these pages. Otherwise, think large-scale HR, payroll, financial and manufacturing systems. A résumé is available if you wish. The editor has a graduate degree in Eighteenth-Century British Literature from Duke University where he was a National Woodrow Wilson Fellow, and taught English and music in upstate New York in the seventies, and then in the early eighties moved to California and left teaching. The editor currently resides in Hollywood California, a block north of the Sunset Strip.
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