Previewing Obama's Budget Cuts

The White House will send its budget proposal Monday down Pennsylvania Avenue to the Capitol. Guy Raz examines three areas of spending the president has signaled he's willing to cut: earmarks, Community Service Block Grants and Community Development Block Grants. Also, budget-watcher Stan Collender predicts what other cuts might be on the table.

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GUY RAZ, host:

From NPR News, this is WEEKENDS ON ALL THINGS CONSIDERED. I'm Guy Raz.

Tomorrow, the White House will send its budget proposal down Pennsylvania Avenue, right to the Capitol. Now from what we know about it, the budget includes some major cuts. The president hinted at some of them in his weekly video address yesterday.

President BARACK OBAMA: My budget freezes annual domestic spending for the next five years, even on programs I care deeply about.

RAZ: President Obama and congressional Republicans have both pledged to do away with earmarks, otherwise known as pork-barrel spending that members of Congress send to their home districts. We hear about the more extreme examples - the fish museum in Georgia, millions for potato research, the bridge to nowhere -but not a whole lot about where most of it actually goes, to places like the YWCA women's shelter in Salt Lake City, Utah.

Ms. ANNE BURKHOLDER (Chief Executive Officer, YWCA Salt Lake City): Like many nonprofits, we have felt the effects of the recession on individual giving.

RAZ: That's Anne Burkholder. She runs that facility. She was counting on an earmark, $485,000 from the government, money that would allow her to keep that shelter open for 24 hours a day for the next year. She says most women come for help in the middle of the night, like one young mother who recently came in with her two small children.

Ms. BURKHOLDER: I think one was 6 months old and the other may have been 4, her two little girls, bundled them up in the middle of the night because her own home wasn't safe, and her husband was threatening both her and her children.

She finally made her way to the YWCA, was welcomed here, stayed just six months. And when she left, she had an apartment of her own, she secured a great job, and she is flourishing. And that's what the request to the federal government was all about.

RAZ: Earmarks like those that go to Anne Burkholder's shelter account for just 1 percent of the federal budget. So to make a substantial dent in overall spending, the president is pushing for deeper cuts elsewhere, an idea he floated in his State of the Union address.

President OBAMA: I propose cuts to things I care deeply about, like community action programs.

Ms. MILLY ARBAJE-THOMAS (Director, ABCD's Parker Hill/Fenway NSC): I couldn't believe it. I was shocked. I was like, is this really - this is not happening from our president. You know, I couldn't believe that I heard it.

RAZ: For 18 years, Milly Arbaje-Thomas has worked with ABCD. It's a community service organization with offices all over Boston.

Ms. ARBAJE-THOMAS: I was in my bed watching the State of the Union, and when I heard him mention community action programs, I jumped out of the bed. I was like, oh, my god, that is ABCD.

President OBAMA: We have to confront the fact that our government spends more than it takes in.

RAZ: The White House says its budget will cut the deficit by $1.1 trillion over the next decade. And to do that, the president will propose slashing Community Service Block Grants.

This is federal money made available to community organizations for things like after-school clubs, summer jobs for teenagers, and in cold places like Boston, to help low-income families pay for heating oil during the winter.

Ms. ARBAJE-THOMAS: It's very cold. So right now in Boston, a lot of people have to choose whether they have to feed their families, pay for their heat or pay the rent. So this subsidy that we provide through fuel assistance is a huge help. It actually helps the family to get through the month and not be out in the streets.

RAZ: But next winter, that money may simply dry up.

Now the third big cut proposed by the White House will come from another type of community grant: money sent to cities for things like improving neighborhoods, helping to keep small businesses running and fixing leaky roofs and plumbing for the elderly.

Presidents, going back to Bill Clinton, have made cuts in these grants. And all the while, Don Plusquellic's been among the loudest voices fighting those cuts. He's the mayor of Akron, Ohio. He runs a lean government, just over a thousand employees for a city of 217,000.

And Mayor Plusquellic says the city depends on a $7 million grant it receives from the government each year.

Mayor DON PLUSQUELLIC (Democrat, Akron, Ohio): And I think just overall, the problem that we have is that some people in Washington think if you cut a program, the problems are going to go away.

RAZ: It seems very likely that these Community Development Block Grants will take a hit in this upcoming budget. What will be the impact on Akron?

Mayor PLUSQUELLIC: It'll be more houses continue to stand that should be demolished. It will be less opportunity to help older people who are in their homes to be able to keep them in their home. It'll be less opportunity to give low-interest loans and assistance to small businesses to hire people to keep their businesses running.

RAZ: Mayor, why should taxpayers - I'm a taxpayer in the District of Columbia -why should I pay for improvements in Akron versus local taxes?

Mayor PLUSQUELLIC: It's a recognition that we're all Americans. And this idea that somehow, we're this or we're that, and we're red or blue states, or we're in the South, and we're doing fine right now, and to heck with those Northerners, or we're in Texas, and we don't care about people in Ohio, or Ohio, when we find an alternative energy source, and Texans have nothing else to sell but sand, that we recognize that they're part of the United States, and in the future, we help them because we're doing better.

If we eliminate CDBG, our federal government will be spending more money to help rebuild cities in Iraq than rebuild our own American cities. And you put me in a room with the most red-blooded American citizens, and I've got a lot of them who live here in Akron and around, and I grew up with them, you let me in that room to explain those numbers, and I'll bet you I come out with nine out of 10 of them saying, you know what, that mayor's right.

RAZ: That's Don Plusquellic, the mayor of Akron, Ohio. He spoke to us from the studios of WKSU.

Now all those proposed budget cuts are substantial, but in fact, they account for just a fraction of the overall budget. Many elected officials talk about across-the-board spending cuts, but according to Stan Collender, a former congressional staffer who worked on the House and Senate Budget Committees, making those cuts is not so simple.

Mr. STAN COLLENDER (Budget Expert): Basically, when they talk about across-the-board spending cuts, they're only talking about one-third of the budget that gets appropriated every year. The rest of the budget goes up or goes down depending upon a variety of other factors that are already in the law, like the number of people eligible for Social Security this year.

So unless you want to take on some very, very difficult program-by-program decisions on entitlements, across-the-board cuts is not really across the board. It's across the board for only a very select part of the budget.

RAZ: So even if you eliminated all of this discretionary spending - it's only a third of the federal budget - you would still have a deficit this year.

Mr. COLLENDER: A substantial deficit of perhaps about $500 billion. And remember, we're not going to eliminate the entire Defense Department. We're not going to fire 650,000 people in uniform at a time when unemployment is at 9 percent. You're not going to close federal jails. You're not going to, you know, get rid of federal judges - in fact, you can't under the Constitution -along with a variety of other things like the Internal Revenue Service.

So the answer is that even if you eliminated a lot of what you were going to do, there'd be a deficit of probably close to a trillion dollars if all you did is look at discretionary spending.

RAZ: Mm-hmm. So even if the federal government just paid for Social Security, Medicare, Medicaid, the interest on debt and a few other things but got rid of the Department of Education and the military...

Mr. COLLENDER: Transportation...

RAZ: ...Transportation and so on and so forth...

Mr. COLLENDER: Justice.

RAZ: ...the justice system, we would still have a deficit.

Mr. COLLENDER: Yes, a substantial deficit, not one that we could do away with by snapping our fingers.

RAZ: So we're in trouble?

Mr. COLLENDER: Not in trouble, but it's a complicated process, and it's a very politically, you know, difficult decisions that have to be made.

RAZ: Have you seen any serious or realistic proposals out there that you believe suggest creative ways to cut the budget deficit and to cut the budget?

Mr. COLLENDER: The answer is no. There aren't really too many creative ways to do it. I mean, it's really a mathematical thing when you get right down to it.

What's missing from the debate and what would be the truly creative things would be if someone was able to come up with a vision of what the government should be doing, not simply how to slash spending or eliminate programs, but what it would be when you're finished.

That is, what would happen if we didn't have a Department of Education? What would happen if the government didn't support business in a variety of ways? That's the debate that has to take place. It's not simply over numbers. And if all you do is cut programs across the board, what you're going to do is make them ineffective and get people more frustrated with them, rather than actually having, you know, a substantial impact.

RAZ: Let me ask you about this year because Congress still has to approve a continuing resolution to fund government agencies and other projects for the rest of this year. And House Republicans, particularly so-called Tea Party Republicans, are calling for $100 billion in cuts. The leadership Republicans in Congress has approved this idea. Is it something that is likely to be signed and approved by the president?

Mr. COLLENDER: Well, the answer is no, hell no, not going to happen. In fact, it probably won't even get to him because Senate won't pass it as well.

RAZ: So what will happen on March 4?

Mr. COLLENDER: Well, that's the big question. In the past, I would've thought there would've been a compromise. I'm not so sure anymore. The politics in Washington have changed, particularly when it comes to spending and taxes. And the word compromise has been redefined as a four-letter word. To compromise with the White House, to Republicans, is the equivalent of collaborating with the enemy.

I'm not so sure that we won't see another government shutdown, much like we had in '95 and '96. One of the big changes over the last year is that Republicans, particularly Tea Party types, have been saying the only thing they did wrong 15 years ago was that they gave in to Clinton too early.

If that's the case, then on March 5th, 6th and 7th, Americans may wake up each day to find out that the government services, either they rely on or didn't realize they rely on, won't be available to them. That's what happened 15 years ago. There was mass anger when people couldn't get into national parks, for example.

RAZ: There's a new Gallup poll out this past week. It shows that 68 percent of Americans disapprove of the way President Obama is handling the budget. You recently wrote that those kinds of poll numbers ought to be taken with a grain of salt.

Mr. COLLENDER: Well, yeah. First of all, it showed that 68 percent disapprove of the way he's handling the deficit, but his overall poll numbers are up pretty substantially, his approval rating.

Second, when you look at budget numbers, the polls are irrational. Let me give you another poll. There was a Reuters poll from about four weeks ago that said 71 percent of Americans didn't want the federal debt ceiling raised. That is, they want the government to borrow no more than what it's currently allowed to borrow.

But if you dug down into the poll, the only area where there was support for actually cutting spending was foreign aid, which is so small that you could eliminate it and no one would notice. That's an irrational situation.

It seems to be what the polls really are saying is not the top-line number, like you mentioned. It's that Americans are looking for a painless solution, a magic bullet, a magic elixir, something like that. And it doesn't exist.

So here's the interesting question, something maybe we can talk about in a few months: If the president proposes spending cuts or proposes revenue increases, will his approval rating for dealing with the budget go up? My guess is no. It'll probably go down. Americans seem to like government services; they just don't like government spending.

RAZ: That's Stan Collender. He writes for the blog Capital Gains and Games.

Stan Collender, thank you.

Mr. COLLENDER: My pleasure.

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