Defense Cuts Will Make Or Break a Super Committee Budget Deal
by Samir N. KapadiaLike the recent east coast earthquake, the Budget Control Act of 2011 left Washington shaken and completely confused, the epicenter being the Department of Defense.
While some are saying that the super committee will be able to reach a deal and cut the additional $1.5 trillion (half from defense), others are not so confident there will be any agreement, resulting in automatic caps for the next nine years. Either way, defense spending will make or break a super committee budget deal.
Truthfully, Congress has a better chance of willfully trimming the budget at the super committee stage because they have more tools to orchestrate a reduction. Even if they deadlock, they’ll push through artificial savings mechanisms, anything to merit a Mission Accomplished banner. Medicare doc fixes are an example of such “solutions”. Though Congress’s intention was to curb Medicare spending, they came up with an unworkable formula that has now resulted in temporary increases and extensions of existing physician reimbursement rates, all in an attempt to circumvent a long-term solution. Applying this to what Congress may do with defense spending, a successful deal may be nothing more than a tacit convention of today’s culture on Capitol Hill, do anything to avoid Armageddon. And some do consider the trigger provision of the bill to be deadly. Secretary of Defense Leon Panetta even called it the “doomsday mechanism.”
Under sequestration, or the trigger, defense cuts are still a variable certainty. We simply do not know how bad it is. It all boils down to the language of the bill. Here’s why:
1.The bill does not organize any of its spending requirements against any baseline.
2.Positive numbers (discretionary spending caps) without context forces you to make arbitrary assumptions.
3.No analyst can come up with a number that is reasonable/unreasonable.
The question on everyone’s mind: What on earth do we base these numbers against?
The president’s request in February? The president’s April modification? CBO’s baseline? The DoD’s “Green Book” estimates? Using any of these assumptions, an analyst can show a range of reductions in the base defense budget. Over a 10-year period, the difference can be up to $150 billion, depending on what baseline you use. With a range like that, no one knows what to believe. Congress was smart.
The bill is also legally provocative in that, if the committee fails, it changes its basic definitions for the categories of spending that must be cut. At the committee stage, defense cuts are represented under the “security category.” Under sequestration, the now “revised security category” is defined as “discretionary appropriations in budget 050.” Granted that function 050 represents national defense spending, it excludes a particular area of spending that, previously on the table, is now off limits: veterans’ benefits and services. Bravo, Congress.
While function 050 covers the pay and benefits of active, Guard, and reserve military personnel, it does not appropriate money towards programs of the Department of Veterans Affairs (VA), including veterans’ medical care, compensation and pensions, education and rehabilitation benefits, and housing programs. This is all covered by function 700, out of which 90 percent of spending pays for veterans’ health care. Golden rule in Washington: cutting pay/benefits for veterans is politically lethal.
The super committee could have been designed to fail. With veterans’ benefits off the table and immeasurable caps on national defense, Congress would ultimately have to (gasp) raise taxes. Or maybe they do succeed and the Committee schedules a series of cuts that will or will never happen.
In either case, the after effects of the Budget Control Act of 2011 are unknown. However, if we look to Mother Nature, we do know that earthquakes can have large aftershocks, and in some cases, they can last for years.
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33 Comments
The idea of the Super Committee is Super Dumb!
All of the d-cRAT socialists and several of the repubs on this sub-mental committee are walking around with signs hung from their necks saying: "Buy Your Tax Breaks Here" and "I'm For Sale to Protect Your Interests".
Politics as usual.
Obama Just Got His Private Army Better equipped and funded than our military
http://www.infowars.com/obama-just-got-his-privat...
"Even if they deadlock, they’ll push through artificial savings mechanisms, anything to merit a Mission Accomplished banner. Medicare doc fixes are an example of such “solutions”."
You mean they will LIE to us?
Say it ain't so, Joe… err… Samir…
Careful how you speak of the Politburo, Comrade! Big Barry is watching you!
I have a very simple solution to "our" "budget crisis" – stop doing all the damned unconstitutional stuff you idiots in D.C. do – it will produce a surplus over night!
And the economy would take off so fast that we might leave scorch marks in our wake…
The so called "super committee" reminds me too much of ObamaKare. Everything done by the Dictators at the top, rather than Congress who we put in Office to do these things. How about some Law & Order in D.C. or do We the People have to start serving papers and legally protect this Country from the enemy within.
I'd like to see who's going to train them, because our Military men and women despise this little prick. Not to mention that I'm pretty sure my dog could kick their ass in a fight.
Civil war will come very soon now, and when it does, his little civilian army is going to be more like a gnat, to be swatted away.
Spooky! My rifle and I are very intimidated…
Seems some of them were inspired by Moochelle in their dietary habits…
The whacked out bunch of 12 committee is unconstitutional. Would be nice if Judicial watch would take them to task …not like they don't already have their hands full.
Michelle Obama: http://blogs.suntimes.com/sweet/2011/08/judicial_...
Barry and Acorn: http://www.judicialwatch.org/weeklyupdate/2011/34...
Hell, just search "Judicial Watch Obama" …there are a lot more!!!
If anyone in DC had the nads to cut spending and get off the baseline budgeting mainline, we could solve all our problems. Unfortunately, DC is a crack addict that will never recover… until Americans and foreign investors stop buying bonds at such ridiculously low rates of return. When that occurs, it will be a day of reckoning. Gold will soar and so will shorts against bonds. Disclaimer: I have shorted long term treasury bonds. I expect to win big over the long term. When China and Japan stop buying, my positions will start flying.
Clean sweep of Washington D.C. needed. Everybody out who doesn't enforce our American Constitution. Term Limits. No Pensions and complete VETTING of every single person. Oh, and all traitors need to be prosecuted to the fullest extent of the law now!
I don't have a problem with cutting some of the pork from the military budget.
As long as the same knife is used to cut all the entitlement programs….
Including the free cell phones for these people…
Where do you think the universal fee goes?
I like your thinking. I've done exceptionally well since August of 08' with the mindset of "if I was Barry and Soros, what would I do to collapse the economy".
My only concern now is that they are going to nationalize the retirements of Americans, then take all the private property……….which they are doing.
The dumbest part about Washington budgets is even if all they did is freeze spending at the currently ridiculous 3+ trillion dollars a year and not do anything else, there'd be a budget surplus around 10 years from now and the debt would start getting paid down.
But "baseline budgeting" government math with built-in increases every year apparently can't be stopped until more voters say no more business as usual.
This is not a "conspiracy theory." This report is from 2009, recently released:
http://www.rand.org/pubs/monographs/2009/RAND_MG8...
The RAND monograph on "A Stability Police Force for the United States." Just a teensey-weensey issue, Hmmmm, Hmmmm, Hmmmm.
I am worried, too. All my moves have been purely defensive. I think gold will eventually go to over $5000 an ounce. That is a good thing if we own gold, but it reflects badly on our economy. My business has been in a recession for over 4 years. I am praying for Nov. 2012 to come sooner, but we know the reality of politics.
Gov. Moonbeam has been trying to kill our mining business here in CA. They put a moritorium on suction dredging two years ago until Dept. of Fish and Game did another study on if we kill salmon. They already performed a rather expensive and extensive study in 1997 and stated we actually help spawning anadramous fish, but they wanted another………because all the Liberal enviro groups said so.
DFG did another expensive study and came back with the same findings, we don't hurt fish. So just before we were going to be able to dredge again, the Libs came out with a new bill, jammed down our throats in the middle of the night stating the DFG and BLM programs are not self sustaining with the funds they receive from the permitting process. Another lie, they absolutely made up fraudulent data, which we proved as fraudulent, so that bill was tossed. Then, they came up with another, claiming the DFG didn't do enough to prove we don't hurt fish, so Brown extended the moritorium another 5 years.
This has never been about fish, nor will it ever be. Now, some Soros groups are trying to stop all mining claims, of which I have 1100 acres of, claiming we use poisonous chemicals and kill bambi, the red legged frog, the Pelosi slug and Obama ant. Again, more lies. We use gasoline.
There is only one thing which will stop the Communist movement, and we all know what that is.
Cut federal spending by 1% each year for 6 years,
Cap spending at 18% of GDP in the 7th year,
Balance the federal budget in the 8th year, and
Save taxpayers $7.5 trillion over 10 years.
H.R. 1848, the “One Percent Spending Reduction Act”
http://mack.house.gov/index.cfm?p=Penny-Plan
"Arbitrary power is most easily established on the ruins of liberty abused to licentiousness."
George Washington
Whatever happens with this Stupor Committee, it won't make a damn bit of difference. To start with, any real cuts will be back-loaded, and thus irrelevant. Beyond that, in a year and a half we're going to have a new GOP House, Senate, and President, so we will be scrapping this monstrosity and starting over anyway.
AMEN JOHN!
America has already lost since the legislation creating this super committee is unconstitutional. Anything they do will not stand the light of day.
Revenues Spending Deficit Deficit GDP %ages FY1996-FY2011
http://bit.ly/jnfQMr
Total Revenues .vs Defense Spending
http://bit.ly/pHEiWu
Fixing the Deficit/Debt
http://bit.ly/qzeKC0
Super committee means super deadlock.
I'm keeping an eye on my newly elected Senator Pat Toomey, he has been strangely silent since the election.
"NATIONAL DEBT WHEN REPUBLICANS TOOK CONTROL OF CONGRESS AFTER 2002 ELECTION: ~$7trillion "
The Republicans took control of Congress in 1995 not 2002. During Clinton's administration the deficit was reduced to zero. However, once the Republicans took complete control the deficits began to soar as they thought they could buy votes like the Democrats had in the past.
What was the difference between Republicans between 1995-2001 versus Republicans between 2001-2007? The answer is the second worst president of the last 50 years – George W. Bush. Only Obama has been worse.
Bush never vetoed any spending whether from Republican congresses or Democrat congresses.
The average defense budget has increased 8% every year for the last 12 years. The proposed cuts amount to $500 Billion over 10 years or $50 Billion per year. Remember how baseline budget works. The present military expenditures are about $700 Billion. If the average increase is 8% then we can expect $56 Billion in increases. That means that even with the "draconian" cuts the budget will still increase.
No one in Washington is actually proposing to lower a budget. Every single projection made by every single source shows increased budgets for virtually every department.
Don't fall for this nonsense "we will be defenseless as hordes of barbarians run through American streets raping your wives and eating your children". This is pure scare tactic.
With Kerry and Clyburn on the committee it is a non starter and then add Murray the union rep from Washington State nothing will be decided.
Unconstitutional Super Committees aside, those on the right need to come to terms with the REALITY that big cuts in spending are going to have to come from our INSANE defense budget, just as those on the left need to come to terms with the REALITY that big spending cuts must come from Medicare/Medicaid (not to mention if Obamacare withstands the SCOTUS, it will be a fiscal ticking time bomb that WILL destroy our economy).
Sadly, I don't think either side with come to terms with REALITY.
In both cases you have pledges politicians have made to others with OUR credit, with OUR future generations, that they KNOW we cannot afford. And what do we do in return? We applaud them and thank them, and can't wait for the next one to come along and screw us over twice as hard as the last.
Super Committe….how Orwellian….and bloody UnConstitutional….Fly-Over this, Comrades!!!!
Everything has to be cut, there is no alternative.
Ambassador Bolton, on why the "Tea Party" should insist the "Supercommittee" shouldn't cut the DOD budget:
http://www.washingtontimes.com/news/2011/aug/17/w...
With such issues as China's military buildup – including the production of a new generation of nuclear warheads and missiles to carry them-, Iran's race towards nuclear hegemony in the ME, nuclear N. Korea playing Russia against China to prop up it's food-famine and continue being a threat to other states in the region, the despotic regime in Venezuela's chummy relationship with Iran posing the possibility of it possessing nuclear capability, upheaval in Libya threatening to place its missile defense into rogue hands, Egypt's leadership going Muslim Brotherhood, heavily armed Mexican drug cartels spilling its war into US territory, and the security of Pakistan's nuclear arsenal remaining in question (gee, did I leave out anything else?), cutting America's defense budget is not a good idea.
But the senate members chosen to head up the "Supercommittee" don't agree. Instead, they believe pumping more billions into Medicaid so that America's illegals and poor can continue to use the ER for runny noses and gang-warfare recovery is what the nation needs.
US naval forces are already cut to WWI levels. We've seen production of the F-35 next-gen fighter and F-22 ceased. NASA and the shuttle program are scrapped except for militarily useless, though relatively cheap satellites, hurled towards objects like asteroids and planets astronomers want to get closer looks at. Our nuclear arsenal is aging and needs updating to keep parity with the Chinese who are doing the same, and Odumber's bad "S.T. A. R. T." Treaty with the Russians also puts America's nuclear defensive capability at a disadvantage.
Cutting $300-$500B from the Defense budget at this time is stupid and dangerous besides.
The Super Committee divided evenly between Democrats and Republicans will deadlock. The only thing that will break it is the election of 2012.
We have seen what Obama's economic recovery plan has done for the country. The state has provided jobs, but the state produces nothing, so what good are these jobs? The Republicans are proposing a different medicine, using the free market. Jobs in the free market are created by companies engaged in buying and selling of goods. The state collects taxes from them and those people holding private company jobs.
Sounds like a better fix to me. I hope for a change in 2012.
It wasn't the "compromise" everybody in Washington was bragging about. Defense cuts were demanded by Democrats as a poison pill. Defense means little to liberals, and they know they can force conservatives to do anything to avoid gutting our national defense.
A compromise is not necessarily a solution, and in this case, that's exactly what was intended.
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