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Here's why I think the cuts to make the debt ceiling deal, and the possible cuts imposed by the trigger, are much ado about nothing.
If, starting tomorrow, Congress simply stopped doing anything but naming post offices, discretionary spending would stop in a few months, but mandatory spending would continue. Discretionary spending requires constant authorization from Congress; mandatory spending does not. (As a practical matter, the actual administration of cutting the SS checks requires discretionary money so that would probably stop, but you get my point, I hope.)
Cutting discretionary spending in the future, beyond the next fiscal year, is completely meaningless. The 113th Congress will convene in January of 2013 and will spend however much it wants on whatever programs it wants. That's why it's called "discretionary". Passing discretionary cuts that take effect in 2016 just means you're telling the future 114th Congress that you really hope that's all it spends. What you've done is set a hypothetical spending level that the CBO will compare what actually gets passed to, so it does give some rhetorical benefit to people who want to make government smaller. But not all that much, really; over and over and over again discretionary spending caps have been simply ignored. (And, on the other hand, it lets a President say in the State of the Union eg "I asked for and obtained 20 billion dollars in education funding" when in fact he's just returning education spending to what it was before the "cuts").
Cutting mandatory spending in the future, however, is meaningful. If Congress never did anything again, those payments would continue forever at the levels they were set at (again, theoretically, since there would actually be administrative costs to be paid). In contrast, if Congress today cuts Medicare reimbursements in 2018, that is binding until and unless another Congress changes it. That's why it's a good thing that almost all of the cuts are discretionary -- a Congress that wants to keep them would be able to pass them anyways, and a Congress that doesn't want to keep them will simply ignore them.
As far as I've seen, the only cuts in mandatory spending are a slower increase in the reimbursements provided to Medicare providers than would otherwise happen. Do you remember during the health care reform debate all that talk about "bending the cost curve down"? That's what that is. In fact, best as I can make out at least, about 2/3rds of the Medicare cuts are cost containment measures that are already part of the Health Care Reform bill, but haven't yet been factored into budgeting. As a side note, I actually think there's a lot of reimbursements in Medicare we can decrease, as long as we do it smartly (we spend hundreds of billions on tests which have been shown clinically not to actually help anything, for instance), though I understand I'm definitely in the minority on DU for thinking so.
So, my point is: all this has done is express to future Congresses a current sense that they should spend $X rather than $Y. If the "trigger" passes, that's also all it will do (except for some additional Medicare cuts, which as far as I've seen are more extensive than what's already in PPACA). Discretionary cuts past the current fiscal year don't mean squat.
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