Driving the Week: Budgets, Cuts and Jobs
It’s going to be a fast-paced and confusing week in our nation’s capital. Later today, the President will release his budget proposal for Fiscal Year 2012 and the House will begin debate on a bill to fund the government for the remaining seven months of Fiscal Year 2011. On Friday, House Republicans announced their FY11 funding would be $99.6 billion below what the President requested.
In one convoluted and contradictory statement, House Minority Whip Steny Hoyer (D-MD) summarized the mood of big-government liberals: “I think there’s a lot of message and not a lot of substance. … [Spending cuts] ought not to be done in such a way that it undermines the regeneration of the economy.”
How can cuts simultaneously lack substance AND threaten the economy?
Most Americans understand you cannot have it both ways. Either House Republicans altered the space-time continuum or Mr. Hoyer is fundamentally unserious. In this case, I’ll go with the latter.
All this week, we’ll see the defenders of big-government make one simplistic argument: we need the government spend (or “invest”) your money so we can win the future. Intertwined with that is the typical, Keynesian argument that government spending can create jobs.
The graph below shows us all we really need to know:
During the past decade, federal spending has increased (in nominal dollars) from $1.8 trillion to $3.7 trillion. If, as big-government types suggest, federal spending meant more jobs, a better economy and a better future, logic dictates we would not find ourselves in this mess.
Of course, we know better. A dollar of government spending does not generate a dollar-plus of economic wealth, but that is how many government agencies estimate the economic benefits of federal spending. As an example, see this brilliant explanation by Heritage’s Brian Riedl regarding the stimulus job projections.
Americans will hear many false and intentionally misleading claims this week. Most of them will be coming from big-government special interests who are addicted to politicians spending your tax dollars. It won’t be easy to cut through all the nonsense, but Heritage Action will do our level best to untangle the spin and, with your help, push for more spending cuts.