30 December 2009
WITH THE YEAR finally lurching to a sputtering end, we can give thanks and hope that many of the gifts of 2009 will not be revisited upon us in the coming year. Both state and federal policy makers did their best to make the last year one we won't soon forget.
You can't start any discussion of legacy without mentioning the crushing burden of debt that should make our grandchildren detest us. Washington has had a credit card for years and is running it up with the sort of reckless abandon we expect from a 6-year-old in a candy store.
This isn't a new phenomenon, but it has escalated in recent years. Any tether that might have been holding the federal spending balloon to Earth has been severed. Ten years ago, the nation was running a surplus. Total public debt was declining. In fiscal year 2001, our last year of surplus, total budget outlays were about $1.9 trillion. Of that total, discretionary spending was a little less than $700 billion. The current fiscal year is projected to have discretionary spending of a little more than $1.4 trillion -- although this number doesn't include some bailout spending such as TARP or coming bailouts of the government-supported mortgage companies Fannie and Freddie.
All told, the annual deficit -- just the one-year increase in the debt we pass on to our grandchildren -- is more than $1.5 trillion. There's some argument about who should get credit for the fiscal year 2009 budget that was passed under George W. Bush but administered by Barack Obama. Personally, I would blame Bush for most of it since it was his budget, but I think we can agree to put both their names on the gift card.
As if the debt weren't enough, the House and Senate are wrangling over equally bad versions of massive new government health-care spending and regulation. You'll recall that this started as a "let's give health insurance to the uninsured" bill. The original Senate bill took 830 pages to achieve that goal, leading many to wonder what sort of other things were being loaded in. The final Senate version ballooned to more than 2,000 pages and included vote-buying deals for senators clever enough to pretend to be undecided. This vote-buying is typical of both parties but has escalated to new heights in the health-care bill.
Worse than the vote buying are the details of the bill. George Orwell would be proud. With more than 100 new agencies or bureaus, you won't have to worry about pesky state bureaucrats anymore. Control has shifted to the recesses of Washington.
The new Health Choices Commissioner will make sure everything is fine. If you like your insurance, you can keep it -- if he approves the plan, and it's not an inexpensive plan that has you sharing more of the costs than Congress wants, and as long as it isn't so comprehensive that Congress thinks it's a Cadillac (ironically, one of the car companies Congress now controls).
You can still make choices so long as the choice commissioner approves. It's very convenient for you, they promise. The commissioner will have help from another government gift to us -- the Health Benefits Advisory Committee. The committee will make recommendations, and your insurance plan will adopt it so it can be approved.
For a preview of how this will work, look to this fall's recommendations on breast cancer screening. Some of you may have been annoyed that a federal panel was deciding who should and shouldn't have mammograms yet didn't have any oncologists on the committee.
The choices commissioner and his advisory committee are just two more of the gifts lined up in 2009.
Lest you think all the silliness is confined to Washington, let me finish with one of the great foibles from our friends in Concord: a new applicable but not yet written tax on LLCs and partnerships.
At 11:15 the night before the midnight deadline for passing a conference report on the budget, legislators slipped in a tax on LLCs and partnerships. It didn't go through the normal hearing process, was not defined enough to be available for comment, and wasn't considered by both houses except as part of the entire budget package at the last minute.
Six months later, the rules have not been finished even though the tax is to be applied supposedly to the last year. So we passed a new $30 million tax without debate, without written language, and are asking people to pay it before we finish it. Nice work.
Charles M. Arlinghaus is president of the Josiah Bartlett Center for Public Policy, a free-market think tank in Concord.