White House Budget Director Joshua B. Bolten already announced, "This will not be the last request." Senate Minority leader Harry Reid (D-NV) estimated that the recovery from Hurricane Katrina would eventually cost $150 billion. But a spokeswoman for Senate Budget Chairman Judd Gregg (R-NH) said Wednesday that costs could reach the $200 billion range. No matter what the final number is, the mounting cost of the hurricane and its aftermath comes at a time when the federal budget deficit, even though in retreat, is still very large and the cost of the war in Iraq is steadily increasing.
It goes without saying that the federal government should help pay for the recovery of Louisiana and Mississippi. But if the President and Congress are going to create billions in new spending, they risk imposing excessive costs on the American economy. To minimize the relief effort's effect on the deficit, the federal recovery effort should be matched by reductions in other domestic spending. Today, the President should request that the $62 billion in hurricane aid be offset with equivalent spending cuts. Here are some suggestions: He should ask Republicans and Democrats to shift to hurricane relief efforts the $24 billion in pork projects they recently secured for their districts in the highway bill and the additional billions of pork in last year's Omnibus bill. For instance, Rep. Don Young (R-AK) could give up his $230 million "Bridge to Nowhere," while Ted Stevens (R-AK) could turn in the $1.4 million he secured to upgrade the Ted Stevens Airport in Alaska -- along with the other $700 million Alaska is scheduled to receive. House Ways and Means Committee Chairman Bill Thomas (R-CA) could give up the $330 million he secured for a Centennial Corridor loop in his home district of Bakersfield.
Congress could also shift to hurricane relief the $1.8 million going to the Woman's World Cup Tournament or the $6 million going to the Police Athletic League. Then President Bush should ask Congress to eliminate the hundred items he proposed to terminate in his FY 2006 budget, which would free up $8.6 billion for the hurricane recovery.
|
|
|
|
|
|
|
|
Proposed Spending Cuts to Offset Bush Hurricane Relief Request |
| ||
|
|
(Figures are FY2006 outlays in $millions) |
| ||
|
|
Department and Program |
Cost Savings |
| |
|
|
|
|
| |
|
|
|
Agriculture Research Service |
$1,017 |
|
|
|
|
Economic Research Service |
$80 |
|
|
|
|
Farm Service Agency |
$1,046 |
|
|
|
|
Rural Business Cooperative Service |
$153 |
|
|
|
|
Rural Housing Service |
$267 |
|
|
|
|
Foreign Agricultural Service |
$1,200 |
|
|
|
Department of Commerce |
|
| |
|
|
|
Economic Development Administration |
$390 |
|
|
|
Department of Education |
|
| |
|
|
|
Vocational and Adult Education |
$1,928 |
|
|
|
Department of Energy |
|
| |
|
|
|
Energy Supply |
$981 |
|
|
|
|
Applied Research for Fossil Fuel and Renewable Sources |
$269 |
|
|
|
|
Energy Conservation |
$243 |
|
|
|
Department of Health and Human Services |
|
| |
|
|
|
Administration on Aging |
$1,379 |
|
|
|
|
State grants for child support enforcement |
$4,270 |
|
|
|
|
family planning |
$286 |
|
|
|
|
Promoting safe and stable families |
$522 |
|
|
|
|
Abstinence Education |
$138 |
|
|
|
|
Child Care Entitlement to States |
$2,718 |
|
|
|
Department of Housing and Urban Development |
|
| |
|
|
|
Community Development Block Grants |
$6,129 |
|
|
|
Department of Labor |
|
| |
|
|
|
Training Employment and Services |
$5,352 |
|
|
|
Department of State |
|
| |
|
|
|
Andean Counterdrug Initiative |
$734 |
|
|
|
Department of Transportation |
|
| |
|
|
|
Grants-in-Aid for Airports |
$3,001 |
|
|
|
|
Air Traffic Organization |
$6,647 |
|
|
|
|
Grant to the National Railroad Passenger Corporation |
$1,200 |
|
|
|
Other Agencies and Activities |
|
| |
|
|
|
Agency for International Development |
$5,200 |
|
|
|
|
Corporation for Public Broadcasting |
$390 |
|
|
|
|
NASA |
$9,600 |
|
|
|
|
National Endowment for the Arts |
$124 |
|
|
|
|
National Endowment for the Humanities |
$142 |
|
|
|
|
Small Business Administration |
$592 |
|
|
|
Total Proposed Spending Cuts |
$55,998 |
| |
|
|
Source: de Rugy's calculation from the Budget of the |
| ||
Table 1 proposes a series of cuts that would save another $56 billion. Can we really justify billions going to Vocational and Adult Education when so many adults and children just lost everything they owned? The work of many government employees, among them NASA workers and air traffic controllers, can be privatized, along with federal assets such as land, mineral stockpiles, and buildings. The National Endowments for the Humanities and for the Arts should be terminated. The federal government should also sell its woefully inefficient business operations, including the Postal Service, Amtrak, and electric utilities.
Cutting billions of dollars earmarked for USAID programs, such as the malaria initiatives, would also be a step in the right direction. These programs have proven to be beneficial mainly to the bureaucrats who run them. The bottom line is: there are plenty of sources of money that can be shifted to the hurricane relief effort and thus spare taxpayers from the burden of new spending.
Like millions of Americans who have made personal sacrifices to help the survivors of Katrina's devastations, the President and Congress should make a sacrifice of their own. They must cut low priority spending and wasteful programs to offset the new hurricane relief spending increase. Failing to do so would impose excessive costs on the American economy. Being compassionate should not prevent lawmakers from being responsible leaders.
Veronique de Rugy is a research scholar at the American Enterprise Institute.
To see more of the extensive coverage of Hurricane Katrina from TCS, click here.








