Bipartisan Budget Deal Fails to Rein in Spending
U.S. House Speaker Mike Johnson (R-LA) and Senate Majority Leader Chuck Schumer (D-NY) have struck a deal. The deal covers discretionary spending, the portion of the U.S. government’s budget that the U.S. Congress approves each year. Discretionary spending includes items like defense spending, welfare, and federal government operations. For the 2024 fiscal year, the U.S. government will spend $1.59 trillion. Of that, $886 billion will go for defense-related spending, while $704 billion will go for non-defense-related spending.
The deal doesn’t cover mandatory spending, which is pretty much on autopilot because it doesn’t require annual votes for approval by Congress. Mandatory spending includes things like Social Security, Medicare, Medicaid, and Affordable Care Act subsidies. It also consists of the fastest growing category of government spending, interest payments on the national debt.
With the deal, which appears to be supported by President Biden, the potential for a partial shutdown of the U.S. government has been reduced.
But does it save any money for taxpayers?
There are some small spending reductions compared to the baseline set in previous spending bills. CNBC lists the “big” reductions:
Some of the concessions made include a $10-billion cut to IRS mandatory funding under the Inflation Reduction Act and $6.1 billion of the “COVID-era slush funds.”
That $16.1 billion is one percent of how much the U.S. government will spend on only the discretionary portion of the federal budget in FY 2024. $16.1 billion is coincidentally about how much the U.S. national debt increased from January 2 to January 4, 2024.
The U.S. national debt now exceeds $34 trillion, increasing by over $1 trillion in the 112 days from September 14, 2023 through January 4, 2024. The rate at which the national debt grows varies from day to day. When this latest trillion dollars was added to the national debt, it grew at an average rate of $8.9 billion per day. The just-announced spending deal “saves” about two days of national debt growth. Make that two under-average days.
If the growth rate of the national debt doesn’t sound sustainable, you’re right. It isn’t. The current leadership in Washington, D.C. doesn’t appear to be up to the task of addressing the problems posed by excessive government spending.
