The annual federal budget is a whopping $3.6 trillion, but that figure fails to capture the true burden of government on taxpayers. There are a number of GSEs (government sponsored enterprises) that are considered off budget. Politicians use off-budget entities like Fannie Mae, Freddie Mac, and the Postal Service to obfuscate the true cost of government. Additionally, the government runs a number of credit programs, in which taxpayers are on the hook for loan guarantees. These guarantees include loans for college students and for energy programs, such as the one that purveyed failed green energy programs like Solyndra. Under current law, Congress only factors in the cost of the loan itself when formulating the annual budget. Perforce, if the money is paid back with interest, there is no cost to the government. However, as we have learned so painfully, the loans are, all too often, never paid back. Taxpayers have been called on to bailout a modicum of failed loan guarantees. In the private sector, they use “fair value” accounting in calculating the costs of credit programs. Fair value accounts for the costs of the market risk the lender incurs by issuing a loan, in addition to the actual borrowing costs. Yesterday, the House passed H.R. 3581 – The Budget and Accounting Transparency Act (Scott Garrett). This legislation brings Freddie and Fannie back on budget so taxpayers can see the true cost of these officious and destructive enterprises. In addition, the bill will subject all loan guarantees to the “fair value” accounting method that is used in the private sector. Astoundingly, almost every Democrat voted no on this commonsense bill. Remember that this bill doesn’t mandate any changes to these programs or enterprises; it is not an ideologically charged bill. This legislation merely forces Congress to reflect the true cost of government in the annual budget, not unlike what every family does with their household budget. Sadly, even this moderate reform was too bold for Democrats. We will be forced to clash with members of the House leadership over the next few weeks, but we should commend them when they bring legislation from conservatives, such as this budget reform bill, to the floor. As for the Senate, we need to get them to agree to pass any budget, much less use prudent accounting methods. Cross-posted from The Madison Project
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House Republicans Pass Budget Transparency
Sean Trende of Real Clear Politics is one of the better analysts of basic political trends out there, so I was looking forward to his new book The Lost Majority: Why the Future of Government Is Up for Grabs – and Who Will Take It . I was fortunate enough to snag a review copy for RedState, and found it to be a fairly persuasive argument that our general assumptions about the implications of any given election are usually wrong. It was not exactly a groundbreaking argument for me, but then I’m already familiar with Sean’s writing on RCP. Sean makes three claims in The Lost Majority : “First, that the 2010 midterm elections were a result of Barack Obama and the Democrats misreading both their mandate and how they had been brought to power, imagining a realignment in 2008 when, in fact, none had occurred. Second, that the emerging partisan majorities described by theorists from both parties are mirages. Third, that the entire concept of realignments/permanent alignments, which underlies much of the misbegotten analysis of the 2008 elections, is bankrupt and should be abandoned.” (page xiii) The first claim is not exactly going to be controversial to anybody who isn’t a Democrat; the second and third are perhaps more likely to be matters of some controversy to ideologically-minded readers. They should not, however, be dismissed out of hand; after all, there were a lot of very book-smart people advising the Democrats in 2009 and 2010 who based their opinions on the belief that long-term partisan majorities are inevitable and that alignments are possible The collapse of their models should at least be seen as cautionary.
Sean Trende of Real Clear Politics is one of the better analysts of basic political trends out there, so I was looking forward to his new book The Lost Majority: Why the Future of Government Is Up for Grabs – and Who Will Take It . I was fortunate enough to snag a review copy for RedState, and found it to be a fairly persuasive argument that our general assumptions about the implications of any given election are usually wrong. It was not exactly a groundbreaking argument for me, but then I’m already familiar with Sean’s writing on RCP. Sean makes three claims in The Lost Majority : “First, that the 2010 midterm elections were a result of Barack Obama and the Democrats misreading both their mandate and how they had been brought to power, imagining a realignment in 2008 when, in fact, none had occurred. Second, that the emerging partisan majorities described by theorists from both parties are mirages. Third, that the entire concept of realignments/permanent alignments, which underlies much of the misbegotten analysis of the 2008 elections, is bankrupt and should be abandoned.” (page xiii) The first claim is not exactly going to be controversial to anybody who isn’t a Democrat; the second and third are perhaps more likely to be matters of some controversy to ideologically-minded readers. They should not, however, be dismissed out of hand; after all, there were a lot of very book-smart people advising the Democrats in 2009 and 2010 who based their opinions on the belief that long-term partisan majorities are inevitable and that alignments are possible The collapse of their models should at least be seen as cautionary.
I’m hoping Republicans will soon wake up, stop fighting among themselves, and realize that Mitt Romney has the best chance of becoming the nation’s next Ronald Reagan. Everybody remembers Reagan for his single-mindedness in cutting federal spending and taking the government out of the central position in everyone’s life. What they forget is that it was Reagan’s temperament that made all this possible. Think back to Reagan’s famous rejoinder to Jimmy Carter in their first and only debate, “There you go again!” What was the significance of that? Carter had just finish a long, beady-eyed recitation about national health insurance, which, he said, promised “not inpatient care but outpatient care” with “an emphasis on hospital cost containment,” and how Candidate Reagan, of course, was opposed to all this because he had opposed Medicare in 1964. Reagan stood shaking his head and laughing the whole time and when it finally came his turn, he sighed , “There you go again.” The audience laughed and why not? Carter’s expressionless, robot-like recitation typified his whole presidency. He was obsessed with details. Reagan’s genial response was that when he opposed Medicare in 1964 it was because he favored another piece of congressional legislation that relied less on government. But in a single moment, Reagan had also revealed Carter as a narrow-minded pedant while he was an affable, good-natured leader capable of keeping things in perspective. Voters liked what they saw and that ended Carter’s Presidency. Mitt Romney has a very similar temperament. In fact he had a “There-you-go-again” moment in the last debate when Rick Santorum launched into his inevitable fulmination about how Romney will never be able to debate President Obama on Obamacare because of Romneycare. Romney gave his usual rejoinder but then added, “It’s nothing to get angry about.” That’s the kind of perspective a President needs. Santorum, you must admit, is a pretty disagreeable individual. He spends the opening portion of every debate congratulating himself on having been at the center of everything good that’s happened in Washington for the last twenty years. Then halfway through he will turn on whoever happens to be the frontrunner and launch an eye-gouging attack, talking out of the side of his mouth and casting sidelong glances all the while to see how far he can bait his chosen target. There is an air of bitterness and grievance about Santorum that is hard to take. President Obama has a similar air of grievance and issue obsession that will make him equally vulnerable in debate. If there’s one candidate who can throw this into relief over the course of a campaign the way Reagan did with Carter, it’s Romney. Let’s face it, he’s an attractive guy. A natural leader, he’s been very successful and has a lovely and courageous (and only) wife, plus a big photogenic family. All this is bound to start growing on people. The New York Times ran some pictures of him with his wife and young family back at Harvard Business School and there was a definite Kennedyesque feel about them. People are going to start responding to him on a personal basis. Now of course there’s the Mormon thing and you can count on the Democrats to flail away at that. An early Politico report said Obama planned to characterize Romney as “weird,” with Mormonism as the implicit centerpiece. I doubt this is going to work. Americans are willing to try new things. That’s how we got Obama in the first place. Romney will be intriguing precisely because he represents another frontier — the first non-Protestant the Republicans have ever nominated for President. The Mormons were indeed a violent and divisive sect in the 19th century but since giving up polygamy in 1890 they have become just another fundamentalist group looking for a place in American history. It’s the Mormon Tabernacle Choir, remember, that gave us that stirring arrangement of “The Battle Hymn of the Republic” (the one we sang in high school). Mormons now lead exemplary moral, often highly prosperous lives. They are very big in the Boy Scouts. In my old neighborhood in Brooklyn, Mormon missionaries had started several Boy Scout troops in African-American neighborhoods and even adopted one young man after his original family fell apart. Romney definitely has that straight-arrow feeling about him, but even that may work as people realize it is still possible to lead moral lives in America. His most formative experience, however, has been as a CEO, where he apparently learned his executive style. Except for a few square-offs with Rick Perry, Romney’s demeanor during the debates has been collegial and inclusive. That’s why he shows that deer-in-the-headlights look when the others first started attacking him. “Why are you going after me?” he seems to say. “Aren’t we supposed to be going after President Obama?” He’s learned to fight back, which is good, but there is still a definite modesty about him. Watch him when he’s giving a speech and the crowd starts chanting “Mitt! Mitt! Mitt!” He falls back into an ingenuous smile and seems to say, “Is this really happening? Do they like me this much? ” All the other Republican candidates are the exact opposite. Santorum has a very narrow mind. He’d make a terrible leader, locking into doctrinaire stands and picking fights. He’s a Senator, not a President. Ron Paul is the same only at a different order of magnitude. Paul enjoys being outside the tent pissing in, if you don’t mind the expression. I doubt he could find twelve people in the whole country with whom he could agree enough to form a cabinet. Like so many libertarians, he takes pride in how much he can offend people. As President, he’s sit in the Oval Office disagreeing with everyone in Washington, as he’s done for the past 30 years. Newt is the same thing over again — the perpetual insider posing as a victim of the Washington elites. He would launch his administration with all the grandeur of Napoleon invading Russia but overlook some critical detail that would leave him in full retreat by the following winter. Probably he would decide that history dictates we put a colony on the moon and then spend the rest of his administration arguing about it with Congress. Now I know what people are going to say: “But that’s exactly what we want. Romney would just go down and get along with everyone in Washington and nothing would change. We need someone who’s going to shake things up from top to bottom.” But that’s not how Reagan did it. He didn’t pick fights. He did a few photo-ops with Tip O’Neill, the only Democrat with any authority. Reagan won with an agenda and a first-class temperament. I have no doubt Romney can do the same. Critics will argue Romney doesn ‘ t have Reagan ‘ s ideological commitment, but experience in the private sector brings you to the same place. Anyone who can do simple math knows this country is headed off a cliff and anyone who ‘ s tried to operate a business knows government regulation is strangling free enterprise. Mitt has the same Reaganesque ambitions as the other candidates. What he doesn ‘ t share is their sense of bitterness and exclusion. Much of this comes, no doubt, from his fortunate background. He did go to Cranbrook, the premier prep school of the Detroit area and started at Stanford. But there’s a great deal of Midwestern modesty in him as well, reminiscent of Dwight Eisenhower. Historians have pointed out that all the generals under Eisenhower in the European theater harbored huge egos. There was the imperial Lord Mountbatten, the flamboyant General Patton and the GI’s favorite, Omar Bradley. Had Eisenhower been another swashbuckler, the whole staff might have disintegrated into a boiling cauldron of competition. But as a modest Midwestern farm boy, he was able to hold the whole thing together. He didn’t make a bad President, either. Romney has the same qualities. Whereas Newt would make a great General Douglas MacArthur, ready to challenge everyone else’s authority, Romney obviously prefers to organize without putting himself out front. He lets others have their say. His one great weakness is that he doesn’t yet seem to have the common touch. He still looks uncomfortable in crowds and can’t seem to relate to people who don’t share his background. Maybe the trip from Cranbrook to Cranford NJ isn’t that easy. But I’d be surprised if he doesn’t get better during the campaign. As Jimmy Carter would ultimately discover, this election will not be decided by who can memorize the longest list of talking points. It’s going to be won by the candidate who voters feel most comfortable having in their living rooms. Obama passed the test in 2008. He was young and fresh and seemed to have a level head while McCain appeared old and tired. It was a fairly easy choice. But the President won’t have those advantages this time around. After four years of mismanaging the economy, he won’t be able to talk hope and change. His only option will be to go negative, portraying Romney as a rich boy who doesn’t care about anyone who doesn’t have money. That may work for a while but at some point people are going to want to hear something positive.
I’m hoping Republicans will soon wake up, stop fighting among themselves, and realize that Mitt Romney has the best chance of becoming the nation’s next Ronald Reagan. Everybody remembers Reagan for his single-mindedness in cutting federal spending and taking the government out of the central position in everyone’s life. What they forget is that it was Reagan’s temperament that made all this possible. Think back to Reagan’s famous rejoinder to Jimmy Carter in their first and only debate, “There you go again!” What was the significance of that? Carter had just finish a long, beady-eyed recitation about national health insurance, which, he said, promised “not inpatient care but outpatient care” with “an emphasis on hospital cost containment,” and how Candidate Reagan, of course, was opposed to all this because he had opposed Medicare in 1964. Reagan stood shaking his head and laughing the whole time and when it finally came his turn, he sighed , “There you go again.” The audience laughed and why not? Carter’s expressionless, robot-like recitation typified his whole presidency. He was obsessed with details. Reagan’s genial response was that when he opposed Medicare in 1964 it was because he favored another piece of congressional legislation that relied less on government. But in a single moment, Reagan had also revealed Carter as a narrow-minded pedant while he was an affable, good-natured leader capable of keeping things in perspective. Voters liked what they saw and that ended Carter’s Presidency. Mitt Romney has a very similar temperament. In fact he had a “There-you-go-again” moment in the last debate when Rick Santorum launched into his inevitable fulmination about how Romney will never be able to debate President Obama on Obamacare because of Romneycare. Romney gave his usual rejoinder but then added, “It’s nothing to get angry about.” That’s the kind of perspective a President needs. Santorum, you must admit, is a pretty disagreeable individual. He spends the opening portion of every debate congratulating himself on having been at the center of everything good that’s happened in Washington for the last twenty years. Then halfway through he will turn on whoever happens to be the frontrunner and launch an eye-gouging attack, talking out of the side of his mouth and casting sidelong glances all the while to see how far he can bait his chosen target. There is an air of bitterness and grievance about Santorum that is hard to take. President Obama has a similar air of grievance and issue obsession that will make him equally vulnerable in debate. If there’s one candidate who can throw this into relief over the course of a campaign the way Reagan did with Carter, it’s Romney. Let’s face it, he’s an attractive guy. A natural leader, he’s been very successful and has a lovely and courageous (and only) wife, plus a big photogenic family. All this is bound to start growing on people. The New York Times ran some pictures of him with his wife and young family back at Harvard Business School and there was a definite Kennedyesque feel about them. People are going to start responding to him on a personal basis. Now of course there’s the Mormon thing and you can count on the Democrats to flail away at that. An early Politico report said Obama planned to characterize Romney as “weird,” with Mormonism as the implicit centerpiece. I doubt this is going to work. Americans are willing to try new things. That’s how we got Obama in the first place. Romney will be intriguing precisely because he represents another frontier — the first non-Protestant the Republicans have ever nominated for President. The Mormons were indeed a violent and divisive sect in the 19th century but since giving up polygamy in 1890 they have become just another fundamentalist group looking for a place in American history. It’s the Mormon Tabernacle Choir, remember, that gave us that stirring arrangement of “The Battle Hymn of the Republic” (the one we sang in high school). Mormons now lead exemplary moral, often highly prosperous lives. They are very big in the Boy Scouts. In my old neighborhood in Brooklyn, Mormon missionaries had started several Boy Scout troops in African-American neighborhoods and even adopted one young man after his original family fell apart. Romney definitely has that straight-arrow feeling about him, but even that may work as people realize it is still possible to lead moral lives in America. His most formative experience, however, has been as a CEO, where he apparently learned his executive style. Except for a few square-offs with Rick Perry, Romney’s demeanor during the debates has been collegial and inclusive. That’s why he shows that deer-in-the-headlights look when the others first started attacking him. “Why are you going after me?” he seems to say. “Aren’t we supposed to be going after President Obama?” He’s learned to fight back, which is good, but there is still a definite modesty about him. Watch him when he’s giving a speech and the crowd starts chanting “Mitt! Mitt! Mitt!” He falls back into an ingenuous smile and seems to say, “Is this really happening? Do they like me this much? ” All the other Republican candidates are the exact opposite. Santorum has a very narrow mind. He’d make a terrible leader, locking into doctrinaire stands and picking fights. He’s a Senator, not a President. Ron Paul is the same only at a different order of magnitude. Paul enjoys being outside the tent pissing in, if you don’t mind the expression. I doubt he could find twelve people in the whole country with whom he could agree enough to form a cabinet. Like so many libertarians, he takes pride in how much he can offend people. As President, he’s sit in the Oval Office disagreeing with everyone in Washington, as he’s done for the past 30 years. Newt is the same thing over again — the perpetual insider posing as a victim of the Washington elites. He would launch his administration with all the grandeur of Napoleon invading Russia but overlook some critical detail that would leave him in full retreat by the following winter. Probably he would decide that history dictates we put a colony on the moon and then spend the rest of his administration arguing about it with Congress. Now I know what people are going to say: “But that’s exactly what we want. Romney would just go down and get along with everyone in Washington and nothing would change. We need someone who’s going to shake things up from top to bottom.” But that’s not how Reagan did it. He didn’t pick fights. He did a few photo-ops with Tip O’Neill, the only Democrat with any authority. Reagan won with an agenda and a first-class temperament. I have no doubt Romney can do the same. Critics will argue Romney doesn ‘ t have Reagan ‘ s ideological commitment, but experience in the private sector brings you to the same place. Anyone who can do simple math knows this country is headed off a cliff and anyone who ‘ s tried to operate a business knows government regulation is strangling free enterprise. Mitt has the same Reaganesque ambitions as the other candidates. What he doesn ‘ t share is their sense of bitterness and exclusion. Much of this comes, no doubt, from his fortunate background. He did go to Cranbrook, the premier prep school of the Detroit area and started at Stanford. But there’s a great deal of Midwestern modesty in him as well, reminiscent of Dwight Eisenhower. Historians have pointed out that all the generals under Eisenhower in the European theater harbored huge egos. There was the imperial Lord Mountbatten, the flamboyant General Patton and the GI’s favorite, Omar Bradley. Had Eisenhower been another swashbuckler, the whole staff might have disintegrated into a boiling cauldron of competition. But as a modest Midwestern farm boy, he was able to hold the whole thing together. He didn’t make a bad President, either. Romney has the same qualities. Whereas Newt would make a great General Douglas MacArthur, ready to challenge everyone else’s authority, Romney obviously prefers to organize without putting himself out front. He lets others have their say. His one great weakness is that he doesn’t yet seem to have the common touch. He still looks uncomfortable in crowds and can’t seem to relate to people who don’t share his background. Maybe the trip from Cranbrook to Cranford NJ isn’t that easy. But I’d be surprised if he doesn’t get better during the campaign. As Jimmy Carter would ultimately discover, this election will not be decided by who can memorize the longest list of talking points. It’s going to be won by the candidate who voters feel most comfortable having in their living rooms. Obama passed the test in 2008. He was young and fresh and seemed to have a level head while McCain appeared old and tired. It was a fairly easy choice. But the President won’t have those advantages this time around. After four years of mismanaging the economy, he won’t be able to talk hope and change. His only option will be to go negative, portraying Romney as a rich boy who doesn’t care about anyone who doesn’t have money. That may work for a while but at some point people are going to want to hear something positive.
