One of the most overused and largely false ways to demonstrate leadership is to set a numerical target—a target big enough to embrace the problem and far enough out into the future to allow its proponents to get back to business as usual.
Targets attract elected politicians like honey. Over a hundred countries have signed on to global targets to cut CO2 emissions, eliminate diseases, and reduce poverty. In North America, years have safely been spent fighting over which jurisdiction or political party has the most ambitious and most interesting intentions. Indeed, on climate change, politicians only seem to get in trouble when they stop setting goals and get specific.
The US Congress is handsomely populated by those who’d bring order to America’s public finances . . . by binding the future. For instance, Senators Bob Corker of Tennessee, a Republican, and Claire McCaskill of Missouri, a Democrat, want to reduce spending to a cap of 20.6% of GNP, the last forty-year average. Exceeding that limit, they propose, would result in across-the-board spending cuts that could only be wavered by a super majority of votes in both chambers.
Click on: http://www.nationalpost.com/todays-paper/congress+holds+fiscal+handcuffs/4214580/story.html
Most of the problems with this initiative are straightforward. Projecting the past onto the future is not demanding psychologically, but it is, on the face of it, arbitrary. It would inevitably be challenged by changing circumstances. For numerous good—and politically compelling reasons—future Congresses could easily exempt expensive new initiatives with separate legislation.
Furthermore, three gigantic spending obligations—defense, seniors’ entitlements, and debt servicing—will not sit still. Demographics, capital markets, and global risks can’t be made to conform to a forty-year average.
They could have made their “straightjacket” more credible if they’d put it on debt rather than spending. That would deal more directly with the priority problem and, at the same time, give government permission to look at revenue-raising measures as well as cuts and spending efficiencies. Moreover, they could have given a spending target some meaning by proposing real cuts in programs for individuals and subsidies for industries that would help meet their target.
Targets can be useful in getting maximum value out of immediate tough decisions. Literally, they can make it easier to see the “long-term gain” to be earned from “short-term pain.”
Unfortunately, this proposal to target a rolling forty-year spending average evades the task at hand, and, in doing so, only makes the problem more difficult.
Both sides of the aisle in Congress acknowledge that the status quo is untenable. It isn’t self-correcting; it’s out of balance. An ordered and balanced future can’t be legislated in Congress—or by a Tea Party constitutional amendment—only to be implemented in the future. That future will only be earned by changing how the federal government spends and how Americans are taxed right now.
(Without implicating anyone practicing politics in Washington today, it’s true that serious radicals also use targets, often, to bloody effect. Frank Dikotter, in “Mao’s Great Famine: The History of China’s Most Devastating Catastrophe, 1958-1962,” reports that in 1957 Mao decided that China must overtake the British economy within fifteen years. It’s estimated that his high-speed Great Leap Forward cost up to 45 million lives.)
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