Rep. Mulvaney: "The Republican Budget Is a Deficit Bust"

Rep. Mick Mulvaney (R-SC) wrote a commentary published in The Wall Street Journal on Monday in which he decried the recently-passed budgets in the House and Senate for their irresponsible approach to defense spending. The budgets use a gimmick to provide higher defense spending than allowed by the spending limits in the Budget Control Act without having to pay for it.

Mulvaney called for any increases in defense spending to be offset with spending cuts elsewhere. This principle of offsetting sequester relief with savings elsewhere in the budget has been followed by most sequester relief plans, whether in the President's Budget, the 2013 Ryan-Murray budget agreement, or the Senate amendments to this year's budget. If lawmakers are going to relax the sequester, they should replace it with other savings, preferably smarter savings that are more focused on long-term deficit reduction.

Mulvaney explained:

"Freedom isn't free," Sen.[John] McCain tweeted at fiscal conservatives before the Senate passed a budget using the same gimmick as did the House. Our response: We agree with you, senator. It's not free. So let's pay for it. What House and Senate budgets tell people is this: "Defense is important, but let's borrow the money and let our children pay for it." That isn't courage, but the opposite.

Both the House and Senate budgets include a provision that increases defense spending above current law budget caps by putting $38 billion more than the Pentagon requested in the Overseas Contingency Operations (OCO, or war spending) account. Because OCO spending is not subject to the caps, these budgets are not required to finance their increases in defense spending with offsetting cuts in other areas, increasing the deficit and circumventing budget rules. This dishonest strategy is becoming increasingly utilized, and if it is included in the budget resolutions transparently to fund non-war defense spending above seuqester levels, it would represent a significant expansion of its use.

Mulvaney argued for an alternative that offset the increased spending, saying:

By far the largest objection is that this additional military spending isn’t “paid for.”...That willful decision to avoid making hard fiscal decisions forced many deficit hawks to abandon the budget. Many of us supported an alternative that provided almost the same military funding but paid for the extra spending with reductions elsewhere.

House Republicans had the option of passing their original budget that would have required offsets for $20 billion of this increase, but that partially-offset budget failed. Rather than examining whether the BCA caps continued to make sense, Congress punted on revising the caps and offsetting any increases in spending above caps in favor of a gimmick that allows bypassing them. It will also make it much harder to resist the temptation to use OCO as a slush fund in future years.

Mulvaney calls for adhering to fiscal discipline by offsetting increases in defense with savings elsewhere in the budget instead of using the OCO slush fund to get around budget caps. He and others will still have a chance to impose fiscal discipline on defense spending in the budget resolution conference by maintaining a parliamentary measure in the Senate budget that establishes a 60 vote point of order against legislation designating more than $58 billion for war spending. This point of order will be a key issue as the House and Senate resolve differences between their respective budget resolutions.

You can read the entire commentary at the Wall Street Journal here.