Sure, weed out the un­de­serv­ing poor. But don’t ig­nore the un­de­serv­ing rich.

The Washington Post Sunday - - BUSINESS - Steven Pearl­stein

There is plenty to crit­i­cize, or even be out­raged by, in the 2018 bud­get un­veiled last week by the Trump ad­min­is­tra­tion with­out hav­ing to re­sort to the hack­neyed end-of-the-world rhetoric used by ad­vo­cates and in­ter­est groups — and, alas, too many jour­nal­ists — in re­sponse to ev­ery pro­posed cut in gov­ern­ment spend­ing.

From strictly a rhetor­i­cal point of view, it is sim­ply in­ac­cu­rate to claim that a pro­gram has been “dec­i­mated” or that lives will be “dev­as­tated” be­cause to­tal spend­ing might be cut 10 per­cent or even 20 per­cent from what had been pro­jected. Yes, it is pos­si­ble that such cuts may be un­wise, un­fair or even eco­nom­i­cally self­de­feat­ing. But it is also pos­si­ble that such cuts re­flect an eco­nomic judg­ment that past in­creases in spend­ing are un­sus­tain­able go­ing for­ward (health spend­ing, for ex­am­ple), or a rea­son­able pref­er­ence for shift­ing con­trol and fund­ing to a dif­fer­ent level of gov­ern­ment (hous­ing sub­si­dies, for ex­am­ple), or are based on a cred­i­ble as­sess­ment that pro­grams are in­ef­fec­tive (job train­ing is an ex­am­ple).

I like “Mas­ter­piece The­atre” and a Beethoven sym­phony as much as the next up­per-mid­dle­class pro­fes­sional, but I can see why some peo­ple might won­der why their tax dol­lars should sub­si­dize my taste for Bri­tish drama and clas­si­cal mu­sic but not their pref­er­ence for NASCAR and coun­try western mu­sic.

And is it re­ally be­yond the pale to think that the highly prof­itable drug and med­i­cal de­vice in­dus­tries might pay for a greater share of the cost of run­ning the Food and Drug Ad­min­is­tra­tion so tax­pay­ers can pay less?

For years now, it has been ob­vi­ous to both lib­eral and con­ser­va­tive an­a­lysts that the sharp in­crease in the num­ber of peo­ple who qual­ify for So­cial Se­cu­rity dis­abil­ity pay­ments has more to do with the de­clin­ing job prospects of blue-col­lar work­ers than it does with any sud­den in­crease in phys­i­cal and men­tal in­fir­mi­ties in se­lect de­mo­graphic groups. But rather than wel­com­ing a pro­posal to re­view some of these dis­abil­ity des­ig­na­tions, the pres­i­dent’s op­po­nents have seized the

op­por­tu­nity to grand­stand on the is­sue, por­tray­ing the pro­posal as a cruel ef­fort to pun­ish ev­ery­one with a phys­i­cal or men­tal hand­i­cap.

Some of us may also con­sider it hard­hearted to cut off food stamps or child tax cred­its to poor fam­i­lies who have come to this coun­try il­le­gally, but even we must ac­knowl­edge that there are mil­lions of Amer­i­cans who are out­raged by the wide­spread flout­ing of im­mi­gra­tion laws. Can­di­date Don­ald Trump could not have been any clearer that he shared that out­rage. And now that he has been elected, no­body should be sur­prised that Trump is propos­ing to deny il­le­gal im­mi­grants the ben­e­fits of our eco­nomic safety net.

Or con­sider the pro­posed cuts in re­search fund­ing. Given the num­ber of peo­ple who die from can­cer or suf­fer from the rav­ages of Alzheimer’s, some of us are in­clined to spend what­ever it takes to find a cure for such dis­eases. But is the right num­ber nec­es­sar­ily $32 bil­lion, the cur­rent bud­get of the Na­tional Institutes of Health? Maybe the right num­ber is dou­ble that amount — or half of it. The an­swer is not self-ev­i­dent.

It is quite pos­si­ble, in fact, that there is a point of di­min­ish­ing re­turn to re­search into any dis­ease, or that too much of the money goes to ad­min­is­tra­tion rather than ac­tual re­search, or that there are less ex­pen­sive ways to save more lives.

In the area of en­ergy, the gov­ern­ment funds re­search to find new tech­niques to man­u­fac­ture so­lar pan­els or ex­tend the life of nu­clear power plants or cap­ture and bury car­bon emis­sions com­ing from power plants. But is that the kind of ba­sic re­search that only gov­ern­ment can do, or is it de­vel­op­men­tal prod­uct re­search that ought to be paid for by in­dus­try?

These are le­git­i­mate ques­tions that de­serve a re­spect­ful hear­ing and rea­soned dis­cus­sion.

What they don’t de­serve is to be shouted down by a Wash­ing­ton es­tab­lish­ment that re­flex­ively dis­misses any pro­posal to cut any pro­gram at any time. We ought to be able to ques­tion the spend­ing pri­or­i­ties of the con­ser­va­tive Re­pub­li­cans who wrote this bud­get with­out re­sort­ing to ques­tion­ing their mo­tives, their in­tel­li­gence and their hu­man­ity.

In­deed, the real prob­lem with the Trump bud­get is not that it chal­lenges the ef­fi­cacy of so much gov­ern­ment spend­ing, but that it does so se­lec­tively and in­con­sis­tently.

If, for ex­am­ple, it is nec­es­sary to slow the growth in spend­ing on med­i­cal care for the poor and dis­abled un­der Med­i­caid, which has been ris­ing faster than the rate of med­i­cal in­fla­tion, why is it not nec­es­sary to slow sim­i­lar growth in spend­ing on med­i­cal care for the el­derly un­der Medi­care?

En­ti­tle­ment re­form is not some­thing that ought to be lim­ited to the poor.

There’s a sim­i­lar lack of con­sis­tency in the treatment of na­tional se­cu­rity spend­ing. Does any­one re­ally be­lieve that the waste, fraud and abuse that the pres­i­dent be­lieves to be so ram­pant in pro­grams deal­ing with health, ed­u­ca­tion and wel­fare is some­how ab­sent in pro­grams run by the De­part­ments of De­fense and Home­land Se­cu­rity, where the pres­i­dent and his Repub­li­can al­lies are propos­ing dou­ble-digit in­creases?

We can, per­haps, sym­pa­thize with Of­fice of Man­age­ment and Bud­get Di­rec­tor Mick Mul­vaney’s de­ter­mi­na­tion to sep­a­rate the de­serv­ing poor from the un­de­serv­ing, but why is Mul­vaney so un­con­cerned about mak­ing the same ef­fort to weed out sup­port for the un­de­serv­ing rich?

Un­der the pres­i­dent’s tax and spend­ing pro­pos­als, some­one who puts in 10-hour days at a con­struc­tion site or in a hos­pi­tal emer­gency ward will wind up pay­ing in­come and pay­roll taxes equal to 20 per­cent of his in­come, while the bil­lion­aire hedge fund man­ager will pay only 15 per­cent. And un­der the same plans, some­one who earns $50 mil­lion through hard work and in­ge­nu­ity de­serves to pay an ef­fec­tive tax rate of 25 per­cent while the ne’er-do-well son who in­her­its $50 mil­lion from his daddy pays no taxes at all. What is the eco­nomic or moral logic be­hind that?

The pres­i­dent and his team have also made ex­or­bi­tant claims about the amount of eco­nomic growth that will be un­leashed as a re­sult of their tax and spend­ing pro­gram — an im­prob­a­ble $2 tril­lion in ad­di­tional out­put over the next decade.

But nowhere in the bud­get doc­u­ment is there any men­tion of the off­set­ting drag on eco­nomic growth that will re­sult from hav­ing a work­force that is less healthy as a re­sult of cuts to Med­i­caid and Oba­macare, or less ed­u­cated as a re­sult of re­duced sub­si­dies for col­lege loans and work-study pro­grams. Nor is there any con­sid­er­a­tion of the fact that our econ­omy would be less in­no­va­tive as a re­sult of the re­duced in­vest­ment in ba­sic sci­en­tific re­search, or less pro­duc­tive be­cause of a loss of trust and so­cial cap­i­tal that re­sults from the grow­ing in­come gap be­tween the rich and ev­ery­one else. And don’t for­get that an econ­omy grow­ing so fast will not only en­cour­age more peo­ple who are not work­ing to find jobs — it will also en­cour­age peo­ple who are work­ing and earn­ing more to re­tire early and head to the beach.

If we are go­ing to con­sider the pos­i­tive dy­namic ef­fects of tax and spend­ing cuts on pro­duc­tiv­ity and work ef­fort, as the pres­i­dent in­sists, then we cer­tainly need to con­sider the po­ten­tial neg­a­tive ef­fects as well.


House Democrats, in­clud­ing Mi­nor­ity Whip Steny H. Hoyer (Md.), at lectern, hold a news con­fer­ence at the Capi­tol to crit­i­cize Pres­i­dent Trump’s bud­get pro­posal.

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