Mike Huckabee on the Federal Budget and America's Economy
No discussion of the federal budget is possible without examining the role the burdensome deficit plays in America's economy. Mike Huckabee has a clear and proven successful plan for addressing the deficit. As governor, Mike embraced Arkansas’ Revenue Stabilization Act, which prohibits deficit spending. During his decade plus in the governor’s office, he repeatedly made the difficult decisions on spending and taxes. Mike's take is refreshingly simple, "I believe the late, great Milton Friedman unfortunately said it best in his one-liner: “Government spends what it receives, plus as much as it can get away with.” My philosophy on federal budget policy is actually quite simple and begins with the premise that Americans are not under taxed. I believe maintaining a balanced federal budget is a worthwhile strategic, long-term goal." Currently, the budget deficit as a percentage of United States Gross Domestic Product (GDP) is approximately 2.8 percent, a somewhat surprising figure since this is maintained despite the extraordinary expenses of the Global War on Terrorism, expenses related to the devastation from hurricanes Katrina and Rita, and on-going commitments in Afghanistan and Iraq. Today's deficit percentage is less than the average of the 1970s and 1980s, and far below what pessimists predicted just a year or two ago. During the decade of the 1990s, the deficit fell sharply. Understand though, this was not because President Clinton increased taxes rather, the economy took off while Congress prevented the Clinton administration from spending. During this decade, spending grew at an annual average of only four per cent. Unfortunately, in the past few years Congress has turbocharged the pork machine. To address this, Mike states, "As your President, I commit to protecting your wallets from wasteful spending and protecting your paychecks from greedy liberal tax-hikers, just as I did for the citizens of Arkansas. To achieve the long-term goal of achieving and maintaining a balanced budget, I will promote pro-growth tax policies, perhaps even the idea of true flat tax." He further says, "As President, I will direct all of our fiscal policy efforts to controlling runaway congressional spending. Immediately upon my election, I will take stock of our fiscal situation, develop and implement annual target levels for the deficit as a percentage of GDP, and then manage our national finances to meet those goals." It is unfortunate the “pay as you go” discipline in discretionary spending at the end of the first Bush and Clinton administrations appears to have vanished. “Pay-as-you-go” forced Congress and members of the administration to implement spending cuts offsetting any new spending programs. To Mike's way of thinking, "Tax money from our nation’s citizens must not be treated as a free credit line for Congress."
Many candidates will propose slowing down spending and never really say what spending they plan to address. Perhaps the issue was most clearly addressed when President Reagan stated, “The nearest thing to eternal life we will ever see on this earth is a government program.” Mike Huckabee agrees. Today, it is sad to look back on the record of the Congress controlled by the party of Ronald Reagan for now more than a decade. Earmarks for special interest pork swelled to unimaginable size in recent years from 958 earmarked pork projects in 1996 to almost 14,000 in 2005. Those 2005 projects amounted to almost $23 billion. Mike Huckabee is blunt in his assessment, saying, "In my view, recognizing Iraq as the core component to our resounding defeat in November 2006, I contend this sort of run-away spending, along with the lack of house cleaning of those Congressional members guilty of lawbreaking and zero ethical grounding, became the straw that broke the camel’s back. My approach to federal spending and the deficit is simple and clear-cut - stop digging the hole any deeper!" His plan is bold, yet simple and direct, "Let’s review every program. Let’s review our priorities. Let’s discuss with the Congressional committees the need for budget control. Let’s identify those committee chairmen refusing to restrain spending and defeat them." As an example, why should overall federal spending grow much beyond the rate of inflation? Non-defense, non-Homeland Security discretionary spending is up 34 per cent (23 per cent after inflation since 2001). Sadly this, after a decade of control in the 1990s. Entitlement spending today consumes 53 per cent of the entire federal budget and stands at a record level of over 10 per cent of GDP. To top this dire news off, it is still growing and unchecked, and could double over the next decade. Currently Medicare grows annually up 9 per cent, Medicaid up 8 per cent, and Social Security up 6 per cent each year. The Medicare drug entitlement more than doubles the Social Security payment expectation and is available to all seniors regardless of need. Mike admonishes, "Let me be clear - America will not experience long-term budget reform without entitlement spending reform. Each year we wait adds to the burden on our children. On top of this, the deficit is lower thanks to the current 40 year lows in interest rates. Today, this benefits the Treasury’s issuance costs of the public debt. As interest rates return to more “normal” levels, the interest burden will begin biting again. My goal is to reform the entitlement programs and reduce their projected burden on the taxpayers." Mike understands and can relate to the fact President Bush had a historic opportunity to deal with Social Security and Medicare, but never succeeded in bringing Congress to the table. His plans, coupled with his reform policies, are specific: "I plan to cap increases in domestic, non-defense discretionary spending at the inflation rate or lower. I recommend the Base Closing Commission-type approach to reviewing programs for elimination, combination, restructuring or privatization. I will prioritize spending and if expansion of a program is necessary, seek program budget offsets elsewhere. I will seek line item veto legislation and, once granted, use it. As I did in my decade as Arkansas’ governor, I will use the veto pen, not the signing statement. As America’s leaders, we must return to long-term fiscal planning."
According to Mike Huckabee's way of thinking, "$30 billion per year in special pork earmarks is no way to set an example of fiscal maturity.