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43 IRET Congressional Advisory 1 (1995)

handle is hein.taxfoundation/iretcgadv0041 and id is 1 raw text is: I RE May 16, 1995 No. 43 PAIN FOR A FEW, RELIEF FOR MANY: HOUSE AND SENATE BUDGET RESOLUTIONS ON A NEW TRACK Kudos for the House and Senate Budget Committees! Their respective 1996 budget resolutions would put federal budgets on a path toward zero deficits in fiscal year 2002 and thereafter. In contrast with the deficit reduction efforts in recent years that relied heavily on tax increases, the Budget Committees propose to eliminate deficits solely by Ignored by th reducing spending. And many is that govt of the spending cuts are aren 't free... decreases in the actual level of back on gover outlays, not merely decreases sending mw in spending increases. F heai ernmin )n ba nmnen ;t res These proposed budget resolutions represent a 180 degree turn in budget policy. Instead of merely trimming spending growth while keeping programs and activities substantially intact and indeed adding new spending authority, the House and Senate Budget Committee resolutions move to eliminate or curtail one program and activity after another and to eliminate or reorganize many departments and agencies responsible for these activities. The resolutions aim at eliminating the long-standing impetus for more and more government and at subjecting government budget making to the same kind of economizing rules that households and businesses must follow if they are to survive. Implicit in the respective resolutions is recognition of the fact that every government program, every government activity, every dollar of government outlay has a price tag, i.e., imposes real costs and burdens on the public. Important as it is, eliminating the federal budget deficit is not the unique goal; reducing the federal government's take of the nation's production resources and incomes in carrying out legitimate government functions is just as urgent an objective. The proposed budget resolutions embody this basic principle. The principal criticism of the House and Senate budget proposals does not address these issues. Instead, it attempts to play on the heart strings, bewailing the pain that will be suffered by the beneficiaries of the programs the budget committees want to cut. This is mischief, intended to take the policy debate down the garden trail, because it looks only at the alleged benefits of government activities and never addresses the costs incurred in providing those benefits. -t strings folks It is certainly true that lit programis cutting or eliminating any ~lance ..cutting government program, activity, t activties and or outlay inflicts pain on -t in a net someone or other, whether it's the bureaucrat who directs the activity or administers the program, or the individual, group, or business whose income is enhanced or whose costs are reduced. If budget policy were to be constrained by the requirement to avoid inflicting pain on current beneficiaries, government spending could only increase, and the rate of increase could never be significantly slowed. The heart strings argument really is a pitch for an ever-growing and more intrusive government. Ignored by the heart strings folks is that government programs aren't free. Someone has to Institute for Research on the Economics of Taxation IRET is a non-profit, tax exempt 501(c)(3) economic policy research and educational organization devoted to inorming the public about policies that will promote economic growth and efficient operation of the free market economy. 1730 K Street, N., Suite 910, Washington, D.C. 20006 Voice 202-463-1400 * Fax 202-463-6199 0 Internet www.iret.org utvw Its t lLL it.

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