CUTS AND CONSEQUENCES, CONT’D…. With the threat of a government shutdown still very much a possibility, there’s been a fair amount of discussion about what both sides of the aisle want. There’s been far too little talk about what would happen if one side succeeds.
It’s reminiscent of horse-race journalism during a campaign — the media tells us who’s up and who’s down, but not whose ideas have merit and what electoral victory would mean for the rest of us.
The budget fight is frustrating in identical ways. The discussion has generally focused on what House Republicans want (their $61 billion in brutal spending cuts), why they want it (they allegedly want to address the fiscal mess they created during the Bush years), and what they’re prepared to do to get their way (shut down the government).
But the discourse rarely gets around to that other question: what would happen if Republicans actually got their way? It’s heartening, then, to see the New York Times editorial board take a look at the consequences of the GOP plan.
In a recent report, economists at Goldman Sachs estimated that the House cuts would reduce economic growth by 1.5 percentage points to 2 percentage points in the second and third quarters of 2011. That would devastate employment. As a rule of thumb, each percentage point drop in growth means a loss of 1.2 million jobs. […]
[M]ost of the cuts would be counterproductive. Annual spending on education through high school is cut by 12 percent, or nearly $6 billion (since the cuts would be squeezed into the rest of the current budget year, they are even deeper on an annualized basis).
Those cuts include reductions to Head Start that would remove 218,000 children from the program and cuts to elementary education that would hit 2,400 schools and nearly one million students. Pell Grants for college would also be cut by nearly $6 billion. Transportation investments would be cut by 9 percent, or $8.1 billion, including $2.7 billion from rail, $1 billion from highway spending and $675 million from public transit. Americorps and other community-service programs would be eliminated, although their benefit to society surely exceeds their $1.2 billion cost. Since national service programs are matched by $800 million from foundations and other sources, that would be lost, too.
The list goes on. Small businesses would be hit by a 9 percent cut, or $84 million, to the Small Business Administration. Homeowners facing foreclosure and other Americans with legal problems would be hurt by a $70 million cut to legal aid. Financial regulators would endure deep cuts that would cripple their ability to carry out the Dodd-Frank financial reform law. That’s asking for another financial crisis.
Who’s up and who’s down in the midst of the budget fight certainly matters, but so does the fact that the Republican plan, by any objective measure, is an abject disaster and a recipe for a much weaker economy. For all the silly “job-killing” references during the health care debate, we’re talking about a GOP spending plan that would make unemployment worse, on purpose.
What’s more — and here’s the kicker — Republicans really aren’t disputing any of this. Told hundreds of thousands of workers would lose their jobs if the GOP succeeds, Speaker John Boehner (R-Ohio) said, “So be it.” Told Goldman Sachs projects the Republican plan pushing the U.S. economy back towards a recession, GOP officials blow if it off, and offer no competing projections of their own.
It’s possible political reporters, in general, don’t consider this especially important, since they know full well that the Democratic Senate and Democratic White House won’t approve the Republican plan as-is. Their assumptions are right.
But the House did approve the GOP plan, and Republicans are still sticking to their proposal during ongoing negotiations.
It matters, in other words, that the House majority is pushing a ridiculous plan that would hurt the country. The public should be made aware of it.