Sweeping Reforms Needed to Clean Up “Stimulus”Policies, Analysis Finds

A year after its enactment, the $862 billion "stimulus" package seems to have created more worries about deficit financing than it has created jobs, but what can policymakers do to clean up the mess? A new Issue Brief from the National Taxpayers Union Foundation (NTUF) argues that two budget reform ideas from the past may hold the key to a less debt-ridden future for America.

      "Supporters argued that the federal spending contained in the stimulus would boost the economy and in turn help America grow out of at least some of the budget shortfalls in years ahead, but it hasn't turned out that way," NTUF Senior Policy Analyst and Issue Brief author Demian Brady. "Rather than trying to deny their responsibility for creating the current fiscal mess by "outsourcing" solutions to commissions, policymakers could instead create rules and procedures to make it easier to recommend and consider budget cuts."

      Using research from NTUF's BillTally system, Brady charted a 15-year decline in ideas for budgetary restraint in Congress. He found that at the end of the 104th Congress, 296 Representatives and Senators had legislative agendas whose net overall effect would have reduced federal outlays; at the same time, lawmakers introduced roughly two bills to raise spending for every bill to cut it.  By the end of the 110th Congress (2008), there were only 21 "net cutters" in Congress and the ratio of spending-hike to spending-cut bills stood at 30 to 1.

     In order to reverse these trends, Brady argues, the special-interest-dominated legislative process itself must change in order to allow expedited consideration of spending reductions. One reform he recommends is to reinstitute the "Corrections Calendar," which set up time on the floor of the House of Representatives to repeal or amend laws that were considered outdated, harmful, or unnecessary. This process, begun in 1995, quickly fell into disuse.

     Another reform Brady outlined was a revival of the "A to Z Spending Cuts Plan." Originally proposed in the 103rd Congress, "A to Z" would, in Brady's words, serve as an "intensive budget-cutting boot camp" by allowing a 56-hour special session to consider specific spending reduction ideas under strict rules that would leave little room for political maneuvering.

     In order to answer inevitable skepticism over where such a session could lead, Brady offered an "A to Z" list comprising 26 spending reduction candidates (out of thousands NTUF and others have identified) that could begin the debate, such as: repealing the remaining stimulus funds ($514.8 billion), ending TARP immediately ($150 billion), and eliminating the redundancy of the Council on Environmental Quality and the Office of Environmental Quality ($3 million).

     NTUF is the research and educational arm of the National Taxpayers Union, a nonprofit organization founded in 1969 to work for lower taxes, smaller government, and economic freedom at all levels. Note: NTUF Issue Brief 160, Cleaning Up After the “Stimulus”: A Sweeping New “A to Z Spending Cuts Plan” for the 111th Congress, is available online at www.ntu.org.