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Washington Post Embarrasses Itself on Federal Budget

August 26, 2013

Since 2011, the federal government has slashed $2.5 trillion from the projected national debt over the next decade. Meanwhile, the nonpartisan Congressional Budget Office (CBO) reduced its annual deficit forecast for the federal government to $642 billion, about half of the amount it projected when Barack Obama took the oath of office on January 20, 2009. Forecast spending of $3.457 trillion for fiscal year 2013 is less than the $3.543 trillion estimate the Congressional Budget Office handed Obama as he first entered the Oval Office. As a percentage of the U.S. economy, nondefense discretionary spending is at its lowest level since the 1950's. As a percentage of the U.S. population, federal employment is at also its lowest levels since Ike was President. And as Paul Krugman recently explained, "The sharp decline in deficits means that the medium-term debt outlook is no longer remotely scary; indeed, even if you project out to 2030 it doesn't look too bad."
Unless, that is, you're David Fahrenthold and Chris Cillizza of the Washington Post. In what Cillizza praised as a "terrific piece," Fahrenthold declared, "After six budget showdowns, big government is mostly unchanged."

In an opening that could have been lifted from any Tea Party newsletter, Fahrenthold complained that during a calamitous recession and the nation's painfully slow recovery from it, U.S. government spending hasn't been slashed enough:

After 21 / 2 years of budget battles, this is what the federal government looks like now:
It is on pace, this year, to spend $3.455 trillion.
That figure is down from 2010 -- the year that worries about government spending helped bring on a tea party uprising, a Republican takeover in the House and then a series of ulcer-causing showdowns in Congress.
But it is not down by that much. Back then, the government spent a whopping $3.457 trillion.
Measured another way -- not in dollars, but in people -- the government has about 4.1 million employees today, military and civilian. That's more than the populations of 24 states.
Back in 2010, it had 4.3 million employees. More than the populations of 24 states.

Based on Fahrenthold's numbers alone, you might think another budget showdown is more than warranted to get federal spending under control. But you would be dead wrong.

It's not just that Uncle Sam's annual budget deficit as a percentage of GDP is plummeting from 10.1 percent in 2009 to just 3.2 percent forecast for 2015.

And it's not just that inflation-adjusted federal spending dropped by 5 percent since 2010 or that the federal workforce has contracted by 4.65 percent over the past five years. State and local governments have slashed billions of dollars and hundreds of thousands of jobs, making the recession that started in late 2007 the first in modern history that saw total public sector employment at all levels get smaller. As the Economic Policy Institute concluded in April 2012:

The current recovery is the only one that has seen public-sector losses over its first 31 months...
If public-sector employment had grown since June 2009 by the average amount it grew in the three previous recoveries (2.8 percent) instead of shrinking by 2.5 percent, there would be 1.2 million more public-sector jobs in the U.S. economy today. In addition, these extra public-sector jobs would have helped preserve about 500,000 private-sector jobs.

By the spring of 2013, the Hamilton Project had an even higher estimate of austerity's body count:

We find that the last several years' policy choices are starkly different from those following previous recessions. Specifically, there are 2.2 million fewer jobs today, relative to what would have occurred with the policy response typical of the five preceding recessions.

The Post's Fahrenthold, who never once mentions the word "jobs," similarly omits the impact of the budget sequester which beginning this year is on track to shed a trillion dollars of spending over the next decade. While House Speaker John Boehner claimed, "I don't know whether it's going to hurt the economy or not...I don't think anyone quite understands how the sequester is really going to work." Of course, the Congressional Budget Office understands and told Boehner in no uncertain terms that the economy would be hurt. As CBO Director Douglas Elmendorf told Congress in February:

"The sequester alone will reduce GDP growth this year by 0.6 percentage points, lowering GDP at the end of the year by that 0.6 percent. We think that would reduce the level of employment at the end of the year by about 750,000 jobs."

In July, the CBO offered an update on the sequester's anticipated pain. As The Hill reported:

The nonpartisan Congressional Budget Office on Thursday estimated that keeping the spending cuts from sequestration in place through fiscal 2014 would cost up to 1.6 million jobs.
Canceling the cuts, on the other hand, would yield between 300,000 to 1.6 million new jobs, with the most likely outcome being the addition of 900,000, the CBO said.

For the Washington Post's David Fahrenthold, losing 1.6 million jobs--and more--must be absolutely necessary. Or as conventional wisdom regurgitator Chris Cillizza might put it, "terrific."


About

Jon Perr
Jon Perr is a technology marketing consultant and product strategist who writes about American politics and public policy.

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