Monday, May 7, 2012

Irreconcilable Budget Differences

We have the worst Democrat candidate in decades so this race should be a slam dunk for the GOP, right? Unfortunately, we have one of the worst and weakest GOP candidates in decades and because of that the incumbent may win. Well, this is the guy the Republican Establishment/Progressives wanted so if he loses they have no one to blame but themselves. Again. - Reggie

Mitt Romney continues to miss opportunity after opportunity -- when he should be meeting with House leaders to save the defense budget and move on reconciliation.

This week you're likely to hear a lot more about the death of one of the Beastie Boys and the French election than what Republicans are trying to do to save the Pentagon budget from the wrecking ball of sequestration. The reasons you won't hear about it are lessons for Mitt Romney, who remains oddly disconnected from what House Republicans are doing.

That's the first problem. Romney, the presumptive nominee, is rapidly earning the reputation attributed to the Palestinians almost forty years ago by Israeli Prime Minister Abba Eban: he never misses an opportunity to miss an opportunity. Romney could be working closely with House leaders to pass legislation -- putting Senate Dems under the gun for killing the bills - to illustrate vividly how a Romney presidency would help save the nation from Obama's spending spree, reductions in military strength and over-regulation. But he isn't.

One of the biggest problems that will come to a head soon after the election is the result of last year's disastrous debt ceiling deal, which imposed about $600 billion in defense cuts (on top of the $400 billion Obama already made) over the next ten years. As I wrote here three weeks ago, sequestration imposes limits on future spending across the board, a decision made in perfect ignorance of whether we'd be cutting fat or muscle.

Moreover, sequestration spending cuts will result in the Pentagon breaching its contracts for major weapon systems. These breaches will end up costing as much (or more) to terminate the contracts as it would to actually buy the weapon systems for which the contracts were signed. And sequestration will cost a massive number of high-tech private sector jobs. (According to one study by Dr. Stephen Fuller of George Mason University, the sequestration cuts would cost almost 600,000 jobs and $35 billion in lost earnings in 2013 alone.)

Congressional sources tell me that Democrats are getting nervous about defense sequestration. But with Obama's continued threat to veto any bill that fixes the mess, they're not nervous enough yet to do anything to stop the coming train wreck. Fortunately, House Armed Services Committee Chairman Buck McKeon (R-Ca) and Majority Whip Kevin McCarthy (R-Ca) are stepping up to prevent it.

At four syllables, sequestration is too long a word to use in politics. The fix for sequestration McKeon and McCarthy have chosen is budget reconciliation (two words, eight syllables, beyond the attention span of 98% of the media). Nevertheless, it's a good idea that deserves our support.

Reconciliation is a tool that establishes a budget figure. It bases the figure on instructions to congressional committees to produce enabling legislation that will result in spending at that level. Working over the past few weeks, House committees have come up with legislation that will enable the Pentagon to be protected from the first year of sequestration spending cuts by cutting non-defense programs, from which this week's try at reconciliation proceeds.

The differences between House conservatives, trying to impose some fiscal discipline without sacrificing national defense on one hand, and Obama and Senate Dems who refuse to even consider a federal budget, are irreconcilable. The budget reconciliation measure that McKeon, McCarthy, and others are bringing to the House floor this week will illustrate just how irresponsible Obama and the Dems are. If only people pay attention to it.

This week, the House will pass a budget reconciliation bill that would prevent the sequestration of about $300 billion in defense budget authority that will come into effect in January and instruct the House committees (which have already passed the necessary bills) to make the reconciliation effective. The reconciliation bill will never see the light of day in the Senate.

Which brings us to the lessons for Mitt Romney.

First and foremost, the national security issue isn't critical to the presidential campaign, at least not yet. Obama has managed to push it off the stage in the moments he isn't spiking the ball about the death of bin Laden. In fact, the Republicans have lost their ownership of the defense issue.

In years past, Republicans were the “daddy party,” trusted with the defense of the nation and some grasp of the economy. Dems were the “mommy party,” concerned only with the welfare state and increased government control of the economy.

Now, after eight years of George W. Bush's self-imposed quagmire of nation-building and his oxymoronic “big government conservatism,” Republicans are trusted with neither national defense nor the economy. Obama is engaged in the most massive reduction of our military's capabilities in generations, and Republicans haven't yet been effective in even slowing him down.

If Romney were to get involved personally in the McKeon-McCarthy initiative, he could begin to recapture both issues. Defense spending can't be cut without the so far unaccomplished analysis of what the Pentagon needs to deter or defeat the threats we face. Sequestration cuts defense spending without regard to the threat matrix, and borders on the criminally negligent. It also reduces jobs and GDP without regard to the negative effects on the economy. And -- after the termination costs of breached contracts are paid -- sequestration won't reduce Pentagon spending nearly as much as claimed. Romney should make it his campaign theme all this week. It would gain a level of traction his campaign now lacks.

Romney is now trying to consolidate his influence over the national debate and take on Obama. That's a claim to leadership that he has to assert credibly. The other big lesson for him in the reconciliation debate this week is that Republican control of the House gives him a leadership tool that he has to use.

And there is this...

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