Lawmakers point to entitlements when asked about deficits

The budget-busting spending deal that passed the House with bipartisan support on Thursday is shifting attention to the rising cost of Medicare, Social Security and other entitlement programs that lawmakers in both parties say is really driving the deficit.

“What’s going to increase the deficit is the failure to deal with entitlement spending. That’s what’s driving it,” said Rep. Tom Cole (R-Ok.), an appropriator. 

{mosads}The deal raising the debt ceiling and setting spending limits for defense and non-defense discretionary spending this year will add as much as $1.7 trillion to the deficit over a decade. 

It raised spending by $320 billion over two years, and paved the way for Congress to inject cash into defense, health, education, housing and other discretionary federal programs.

This discretionary spending adds up to $1.3 trillion, less than a third of the roughly $4.4 trillion the Congressional Budget Office projects the government will spend in 2019. The bulk of the spending is known as mandatory spending, and consists of automatic programs such as Social Security, Medicare, Medicaid and means-tested anti-poverty programs.

“I just think we have to have an honest discussion about the entire budget, and most of the budget is on automatic pilot, over 70 percent,” Cole said.

Rep. John Yarmuth (D-Ky.), the head of the House Budget Committee, said discretionary spending hasn’t risen much in the last decade.

“That’s bull,” he said of those saying congressional discretionary spending is busting the budget.

“If you look at where we were 10 years ago, total discretionary spending was 1.3 trillion. And we’ll be just short of 1.4 trillion [this year],” he said.

The annual costs of mandatory programs have grown $1 trillion in the past decade. That’s roughly equal to this year’s projected deficit.

“It’s mandatory. I mean, that’s what the big driver of the deficit is. Tax cuts add about $200 billion a year to the deficit, but the rest is mandatory,” Yarmuth said.

Rep. Mike Quigley (D-Ill.), another appropriator, says that any serious plan for the debt will need to look at the broader drivers of spending.

“You’re blaming the wrong thing,” he said of the caps deal. “The fact that we’re not acting on a big, balanced, bipartisan deficit issues is what’s hurting.”

Budget experts, however, say discretionary spending cannot be completely ignored.

“It’s absolutely true that if you look at the long term, our fundamental fiscal challenge is reining in the cost of entitlement programs,” said Marc Goldwein, senior vice president at the Committee for a Responsible Federal Budget. 

“But the idea that you can ignore everything else is ridiculous,” he added.

While appropriators are correct that discretionary spending is similar to where it was in 2010, those years were anomalies, he said, characterized by huge spending increases to stave off the Great Recession.

“That was a high water mark,” he said.

Some conservatives also balk at the idea that discretionary spending can be ignored if mandatory programs are dealt with.

“That’s certainly an argument. It’s not one that I subscribe to,” said Rep. Mark Meadows (R-N.C.), chairman of the House Freedom Caucus.

Either way, conservatives have long seen entitlement reform as a key to improving the nation’s fiscal situation.

“It’s criminal what we do here sucking a trillion dollars out of the economy, and then shifting those burdens with interest to the next generation,” said Rep. Matt Gaetz (R-Florida). “We have to engage in entitlement reform.”

Democrats such as Rep. Rosa DeLauro (Conn.), a progressive appropriator, argue that cuts to the programs would hurt the vulnerable. 

“I do not see Social Security or Medicaid as a problem. I see the tax bill that the president and my Republican colleagues passed overwhelmingly, did not give a whiff about the deficit,” she said.

“Let’s go there before we begin to go after older people and people who are either disabled, mentally disturbed, who may be addicted getting their care through Medicaid,” she added.

Budget watchers are clear-eyed about the political challenges of changing mandatory programs.

“What makes it hard is the political third rails, the ‘Don’t touch my Medicare, don’t touch my Social Security,’” said Emily Holubowich, executive director of the Coalition for Health Funding, which advocates for higher non-defense discretionary spending.

As a candidate, President Trump promised not to touch Social Security, and was criticized for later proposing changes to its disabilities program. 

Budget experts such as Goldwein are quick to note that reforming mandatory spending programs does not simply mean cutting benefits, but can include revenue raisers.

“You don’t have to believe in small government to believe in fiscal responsibility,” he said.

Members such as Cole think that the solution will require a bipartisan agreement, and that everything will need to be on the table.

“I’m not saying that means cuts. It might involve additional revenue and things like Social Security, but we’re drawing down the trust fund because people are living a lot longer than we thought they were going to live the last time we fix this thing in 1983,” he said.

But if recent history is a guide, there will be little political appetite for tackling the programs.

A 2010 bipartisan commission tasked with reducing the debt, known as the Simpson-Bowles Commission, proposed changes to Social Security and Medicare as part of its overall plan.

It was rejected out of hand.