For several years I’ve received Newt Gingrich’s weekly letter from Human Events, and it’s usually a pretty decent read from a pretty smart guy. But now that he’s in the running for President and moved up onto the list of leading contenders, one needs to scrutinize his words more carefully and some of what I don’t like about Newt came out in his latest edition.
The Washington establishment’s reaction to the runaway spending is a policy of austerity and pain.
Democrats would cause austerity and pain on the individual by raising taxes, thereby shrinking family and business purchasing power.
Republicans would cause austerity and pain to government by cutting spending and thereby shrinking the services and income transfers government provides.
Clearly, shrinking government is preferable to overtaxing the American people but we must remember that there is a third alternative to pain. It is the path of innovation and growth.
So the question is whether Newt is really serious about cutting spending – after all, he is running for the Republican nomination, isn’t he? Newt would rather target his cuts around the edges, like this:
The key to today’s budget problems is to recognize that there is a world that works (largely but not entirely in the private sector) and there is a world that fails (bureaucracies in both the public and private sectors). With even a little creativity, we should be able to maximize the world that works and eliminate the world that fails.
For instance, if we applied modern private-sector management systems to government they would save up to $500 billion a year. That is three times the goal of the Super Committee.
Newt points to a website called Strong America Now, which claims that a quarter of all federal spending is wasted and advocates the Lean Six Sigma model in order to shrink spending down to size. (I’d say that number is quite low, but then again it all depends on your definition of waste.) While it’s a good idea to point this sort of thing out time and again, the trouble is that we’re working within the same parameter – if the system is irreparably broken, nothing can save it. Moreover, this working within the system will likely suffer the fate of most government estimates – the actual amount saved will likely fall short of expectations. And certainly the cuts will be just fine and no one will dispute the need for them until someone’s ox is gored, and there are a lot of sacred cows running around Washington.
My contention is that we need to shrink the services and income transfers government provides in order to bring the federal government to heel, so if Newt doesn’t want to do that I can’t get behind him very well. (I will admit in this case, though, that Newt is right about the idea of block-granting Medicaid to the states.) Being an advocate of a smaller, less powerful federal government I believe the idea of austerity there would bring some pain, but it would only be along the lines of a “you might feel this stick” pain when you’re giving blood or getting a flu shot. In the long term, the patient is much better.
To be perfectly frank, I would have less of an issue paying higher taxes in the state if I had the assurance that the federal government would shrink accordingly. The problem we have now is that all three levels of government seem to want to take more and more, and none of them will look into their proverbial mirror and ask themselves if what they are providing can’t be done better at a lower level or through the private sector. Placing a private sector model on government may be some improvement, but in terms of political philosophy it’s no different than lipstick on a pig. Unfortunately, my fear is that any money “saved” by the ideas espoused by Strong America Now would just be transferred to some other department, agency, or bureau in an ever-expanding statist paradise.
Perhaps I can borrow a phrase Newt made famous to describe the approach we should take. In my view, it’s time for government to “wither on the vine” but I just don’t think Newt is the guy to make it happen.