Caleb O. Brown: This is a Cato special podcast. I am Caleb Brown. In his speech last night to Congress, President Trump promised big spending for the military for infrastructure and by not talking about it much, he promised continued big spending on entitlements. Cato Institute senior fellow Michael Tanner says that looks an awful lot like the spending priorities of George W. Bush.
The big headline for libertarians and conservatives who are serious about spending across the board is that the one area where congressional Republicans and Barack Obama agreed on spending restraint is the thing that Donald Trump wants to get rid of.
Michael D. Tanner: Big government, big spending, conservatism is back with a vengeance. The one sort of constant throughout Trump’s address was that he wanted to spend more money. He wants to spend more money on the military, he wants to spend more money on veterans, he wants to build a wall, he wants to spend more money on infrastructure. Basically every problem the country faces, his answer was that we should spend more money on it. The one thing he doesn’t want to do anything with is changing, of course, entitlement programs. He didn’t bring them up at all. So how he is going to spend more money on everything, leave entitlements unreformed, cut taxes, and still balance the budget, that’s real magic if he could pull it off.
Caleb O. Brown: Ron Wyden, a senator from Oregon, shortly, either during the speech or shortly after it, tweeted out half our budget already goes to the military. And of course he posted a pie chart of just the discretionary federal spending, so at least, I think, Democrats and Donald Trump can agree we need to leave entitlements alone.
Michael D. Tanner: Well that’s right. Why does Trump — Wyden’s tweet was of course just plain silly. It’s about 16% of total federal spending. What we miss is that 48% and rising goes to entitlement programs, and about 38% of that is, or 38% of federal spending is just Social Security and Medicare, which Trump wants to leave unchanged. If you do that and increase that 16% to 17%, 18%, 20%, you are just running out of places to cut.
Caleb O. Brown: Alright, so does he propose cuts? Does he care about cutting spending anywhere?
Michael D. Tanner: Well he has sort of in his budget proposal talked about $56 billion in unspecified cuts. We know that the state department is on the chopping block, probably the EPA. Certainly there’s things we should be cutting, a lot of things we should be cutting. But the problem is that we’ve been cutting those things back, essentially, for years. The percentage of spending that goes to domestic discretionary spending has declined during the Obama administration.
Caleb O. Brown: And this just necessarily so, right? I mean you’ve seen that as programs like entitlements grow.
Michael D. Tanner: That’s right. Entitlements are automatic spending. Basically they go up no matter what. That doesn’t leave you a lot of areas to cut.
Caleb O. Brown: Automatic but not mandatory.
Michael D. Tanner: Well that’s right. Congress could intervene at some point and cut those, but they’d actually have to affirmatively do that if they simply do nothing, which of course is the politically safe course that spending continues to rise as the population ages.
Caleb O. Brown: Donald Trump made his campaign slogan “Make America Great Again” and American greatness conservatism to the extent that it is back. It has always meant big spending, hasn’t it?
Michael D. Tanner: That’s right. This is sort of make government great again. In many ways it is surprising how much Donald Trump looks like George W. Bush. He beat up on the establishment in the campaign, but he really is talking about Bush-style, big government, conservatism, where no matter what the problem is, there’s a government solution. It might be a conservative solution, but it is still imposed from Washington, it still involves a great deal of spending. The idea is that as long as it is being used for conservative or the right ends, big government is justified.
Caleb O. Brown: So I refer to this a lot, because I think it is important when Donald Trump talks about compromise. He offered some compromise, it seemed, on immigration. But I think back to when Rand Paul gave his first floor speech in the Senate he offered a compromise, and that was I’ll put sacred cows for Republicans on the chopping block if you put sacred cows for Democrats on the chopping block. The compromise is almost always on the side of more spending, but Donald Trump doesn’t seem to be at all interested in compromising when it comes to reductions in spending.
Michael D. Tanner: Well that’s right. Donald Trump is more than happy to give Democrats the spending they want if they give him the spending he wants. Republicans, of course, are happy to along with that as well. So we see calls for paid parental leave. We see new childcare programs. We see we are going to build a wall. We see protectionism. We see basically a lot of things that Democrats want, along with a lot more spending for the military, and veterans, and infrastructure, and things Republicans want.
Caleb O. Brown: How much of what he’s proposed in terms of new spending is just dead on arrival. I spoke with Ben Friedman. He says that this military spending hike, which amount to about what, 10%, or a little less than the defense budget right now. How much of that is just not going to happen?
Michael D. Tanner: Well already John McCain of course has complained that the spending hikes Trump has proposed for defense are not enough. He wants to see bigger defense hikes. I think John McCain wouldn’t be satisfied until the entire federal budget was one big defense program. That said, I do think there’s going to be a lot of fights over these things, and he’s not going to get all he wants. And of course that is typical Trump negotiating style, is he demands a trillion dollars in infrastructure and he will settle for $200 billion. The problem is we can’t afford the $200 billion.
Caleb O. Brown: Michael Tanner is a senior fellow at the Cato Institute. Subscribe to and rate this podcast at iTunes and Google Play, and follow us on Twitter, @CatoPodcast.
