BY ROBERT ROMANO | OCTOBER 9, 2013
$3.15 trillion automatic government spending goes on in spite of 'shutdown'
One surprising aspect of the partial federal government so-called "shutdown" is what a small portion of the budget is actually affected, in turn bringing attention to just how little impact Congress can have on spending through the normal budget process.
Some $2.5 trillion of federal outlays – more than 66 percent of all spending – is categorized as so-called "mandatory" spending. This is money that is automatically spent without any vote in Congress.
For the current fiscal year, according to the Office of Management and Budget, this includes Medicaid ($303.6 billion), the Refundable Premium Assistance Tax Credit ($32.2 billion), payments to reduce cost sharing in qualified health plans ($3.9 billion), Children's Health Insurance ($9.9 billion), other health programs ($35.1 billion) Medicare ($523.8 billion), general retirement and disability ($6.9 billion), Federal employee retirement and disability ($140.7 billion), unemployment compensation ($56.2 billion), food and nutrition assistance ($98 billion), Supplemental Security Income ($53.1 billion), family and other support assistance ($25.1 billion), Earned Income Tax Credit ($55.6 billion), Child Tax Credit ($25.1 billion), payments to states for foster care/adoption assistance ($6.9 billion), housing assistance and other ($7.3 billion), Social Security ($860.3 billion), veterans benefits and services ($85.8 billion), and gross interest owed on the debt ($417.9 billion).
The reason these items on the budget are automatically spent is because they are done on the basis of who qualifies under the law, not on how much Congress appropriates for the programs.
In addition, some 2.6 million out of 3.4 million federal employees remain on the job according to CNN including active duty military. When you add another 589,000 postal employees, in total 3.189 million out of 4.139 million federal workers – a whopping 77 percent – are still working.
These are funded out of the so-called "discretionary" portion of the budget as well as from revenues that many agencies like the postal service take in. Yet, if 3 out of every 4 workers remains on the job, one supposes that even this part of the budget – accounting for some $1.2 trillion of spending – is not as "discretionary" as is commonly believed.
Even when the government is supposedly "shut down," when Congress has not voted to appropriate any money – excepting defense and law enforcement Congress did vote to pay for during the shutdown – they continue working and getting paid. Simply remarkable.
Forbes.com's Paul Roderick Gregory finds that of the $620 billion non-defense "discretionary" spending, "at a minimum, $150 billion will be spent on essential services from agencies like Homeland Security, National Nuclear Security, Veterans Affairs, Social Security Administration, and others." Defense spending will continue almost in full.
Therefore, out of the $3.627 trillion budget, even with the government supposedly "shut down," $3.15 trillion will still be spent – some 86.4 percent of the budget.
With the government projected to take in $3 trillion in revenue in 2014, even if the government stayed "shut down" for the entire year would still run a deficit of $150 billion.
Perhaps these sobering facts should give House Republicans cause to keep fighting against Obamacare — because adding even more so-called "mandatory" spending to our budget will mean that we never get the budget back to balance again.
Congress could be abolished, and these programs would continue spending the money apparently into perpetuity, even though Article 1, Section 9 of the Constitution states that "No money shall be drawn from the Treasury, but in consequence of appropriations made by law."
If there's been one great service performed by this funding showdown, it is now abundantly clear to everyone that Congress has no choice but to tackle the even harder issues of automatic spending. Failure to do so is failure to do their job. The shutdown illustrates the problem in no uncertain terms.
To call this a "shutdown" is a cynical joke. Perhaps Congress is the branch of government that ought to be furloughed, since it appears to be little more than an over-heralded debating society, giving the illusion of representation.
Robert Romano is the senior editor of Americans for Limited Government.