The federal budget is back on life support after the passage of an 11th-hour continuing resolution holding government spending at par. This measure is the “clean” spending bill that House Speaker Kevin McCarthy had formerly vowed he would never pass. And now that McCarthy has stepped forward as “the adult in the room” to tamp down all the rudderless tantrum-throwing in the caucus he nominally presides over, he’s on schedule to lose his post—just as his predecessors John Boehner and Paul Ryan did in the wake of past shutdown crises. A vote to oust him could come as early as Monday, October 2.
The continuing resolution has omitted aid to Ukraine, which is now left slowly twisting in the wind, as the saying goes. Even putting Ukraine aside, McCarthy and his caucus have no foreseeable consensus on the budget. Something has to give. A new vote to fund Ukraine will come quickly via the Senate. And it will once more force House Republicans who don’t want to be known as nihilists and obstructionists to defy their MAGA comrades and their orange eminence, Trump, and join with Democrats.
The root of this nutty situation is the perverse leadership incentives at the heart of the MAGA-era GOP. As Hunter Thompson famously said, “When the going gets tough, the weird turn pro.” The pros apparently in charge of the Republican agenda of the House of Representatives are as weird as they come, so they have spent the past four weeks pushing us into the crisis of a disabled US government. And the funny thing is that none of this was really about money.
Former shutdown artist Newt Gingrich was quoted saying, “I frankly don’t understand it—I think it’s sort of nuts.” As conservative Michael Strain of the American Enterprise Institute is saying, it’s the show about nothing.
A disagreement about money is a relatively simple thing, since the number lies along a single dimension—what one party wants vs. what the other one favors. You can always split the difference somewhere in between. What we now have instead is not a debate about numbers but an upsurge of weird identity politics.
The House Republican caucus has been leveraged into all this weirdness by a minority of several dozen Trump-adjacent fanatics. (The others are no bowl of cherries either.) Their identity is to be the party that will smash the State, as we used to say in SDS. Their proposals are what are called “messaging bills”: legislation that nobody expects to be enacted but that makes statements.
The headline statement behind McCarthy’s shutdown crucible is “Oh noes, the national debt”—and the phony magnitude of that rallying cry was made instantly clear once McCarthy cut his deal with the Democrats to keep current spending levels intact.
Like the weather, everyone says they care about the national debt, but nobody ever does anything about it. It just keeps growing, in fair weather and foul. Another funny-strange thing is that people have been screaming about it for decades, but it has not seemed to have any harmful economic consequences. To the contrary, the debt-financed provision of expanded unemployment benefits and the Child Tax Credit in 2021 had wondrous effects on the well-being of the working class. The US economy has emerged from the conniptions of 2020 in relatively good shape. The inflations spike of 2022 is over, and unemployment remains at a rock-bottom 3.9 percent.
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What are the numbers in question now? For the proper perspective, we need a little background about federal spending. In Fiscal Year 2023 (which ended on October 1), total federal spending was projected at $5.792 trillion, $1.154 trillion in excess of revenues. That funding gap adds to the federal debt.
Of that roughly $5.8 trillion, close to 70 percent is devoted in large part to Social Security, Medicare, and other programs known as “mandatory spending” (more loosely, “entitlements”), and interest on debt.
The remaining 30 percent of the federal budget is classified as “discretionary spending.” The funding outlays behind these discretionary programs are up for votes in Congress every year. The mandatory programs run on automatic pilot, for the simple reason that no politician wants to be burdened with voting for the mandatory programs, which everybody knows will roll on—and over anyone raising objections.
About half of discretionary spending—$766 billion—is for defense, which also inexorably increases annually, thanks to the public’s chronic state of national insecurity and the devious machinations of defense contractors. So the grand budget sum at the center of this year’s shutdown crisis was about the remaining non-defense half, roughly $873 billion. If you have been following along, that’s about 15 percent of total spending. Recall that the deficit for 2023 is $1.154 trillion.
While most federal spending consists of checks sent to seniors, health care providers, bondholders, and defense contractors, the other piece funds the actual operations of federal programs, in every field imaginable—law enforcement, public health, infrastructure, health and safety regulation, disaster relief, as well as the bureaucracies that mail the checks. This is the “administrative state” that MAGA thought leaders like Steve Bannon are determined to cut down.
But here we run into a quandary of simple math. Regarding the pretense of any desire to eliminate deficits, and notwithstanding perennial support for tax cuts that increase said deficits, the difficulty of carving $1.154 trillion out of $873 billion should be clear. On Saturday’s vote for the continuing resolution, the Republican House finally passed a budget framework with the messages pared down to one: no help for Ukraine. Otherwise, the messaging has dwelled on immigration, Trump’s ill-fated border wall, and the phantom army of new IRS agents. The real message is still, “We are too uncoordinated to agree on any sort of realistic budget, even just among ourselves.” (Though the measure conveyed another important, if well concealed, ancillary message, in a provision for House members to receive cost-of-living raises: austerity for thee, but not for me.)
Details of other proposed cuts don’t matter. They are dead letters. Moreover, cuts demanded by the House Republicans would contravene the deal struck between their leader McCarthy and Democrats in May of this year. Even the Democrats are not dumb enough to allow somebody to renege on a deal the other party has already bought into.
If the present deal holds beyond its appointed 45-day tenure, it’s important to keep in mind that the larger GOP agenda here is simply an appetite for destruction. We have seen this movie many times before. The contrast this time between the current situation and 2018 is especially stark. In the previous shutdown, the Republican Party controlled both houses of Congress and the White House. In that case, in other words, the GOP had a clear path to doing all the things they are whining that they’re prevented from doing now. Remember “Infrastructure Week”? I remember the week, but I don’t remember the infrastructure.
It’s equally crucial to bear in mind the real-world costs of a shutdown for ordinary Americans, should we see one take hold around Thanksgiving. The political robustness of the mandatory programs carries with it the retention of their most basic functions, but some services to Social Security and Medicare beneficiaries and civil service pensioners will be curtailed.
Otherwise, billions of dollars in economic damage are in store, as we’ve learned from earlier GOP-inflicted shutdowns. The injury to families whose workers are in precarious circumstances will be palpable. For instance, federal workers and troops may be reimbursed eventually, but employees of the many contractors used by the federal government, folks cleaning floors and running cafeterias, will not. Some school programs will shut, creating nightmares for parents in finding childcare. Portions of the National Institutes of Health may have to turn away patients who don’t have time to spare. The list is endless.
We can suppose that, shorn of the Capitol Hill theatrics that produced the unlikely continuing resolution vote, remains the ultimate Republican objective: torpedo the economy, make a mess, and blame it on “Bidenomics.” Recently Fox hostess Harris Faulkner blamed Biden for the spike in child poverty—even though that grim development was a clear outcome of Republican opposition to extending the increased Child Tax Credit.
In short, the lesson of this near-shutdown is the same bequeathed to us by the long train of other GOP-engineered spending crises: Watch what the Republicans do, not what they say—if you can stand it.