Debt Digest | Dad Jokes
Links & Fiscal Facts
Here are this week’s reading links and fiscal facts:
Funding the bomb. “Do you have the money?” reads a one-sentence memo from President F.D.R. to Vannevar Bush, early administrator of the Manhattan Project. In a new article, Catie Edmondson chronicles the story of how the president managed to get the expensive, secretive project past Congress. “[W]hen Congress voted to fund the bomb, there was no debate and no discussion. Only seven lawmakers in the entire Congress had any idea that they were approving $800 million — the equivalent of $13.6 billion today — to create a weapon of mass destruction that would soon kill and maim more than 200,000 people, ushering in the atomic age.” The line-item hiding the $800 million secret? “Expediting production.”
Government-mandated dad jokes. That makes no cents! The National Responsible Fatherhood Clearinghouse is a government website that hosts a repository of dad jokes, a “Dadtalk” blog, and “Dadication” Public Service Announcements (h/t Astral Codex Ten). You read that right. Here’s a sampler: “What kind of tree fits in your hand? A palm tree.” In total, the larger “Healthy Marriage Promotion and Responsible Fatherhood Grants” line item accounted for $149 million in Health and Human Services (HHS) funding for fiscal year 2023. Federal social programs have questionable track records. Marriage support initiatives are best handled by private sector entities.
Scoring transparency matters. The Congressional Budget Office “‘provides detailed reports’ on the account-level budget authority, outlays, and the changes in mandatory programs, known as CHIMPs, in appropriations bills. But these reports are not made publicly available, nor are they made widely available to Members of Congress and their staff.” wrote Matthew Dickerson when he was at Heritage. Making these reports available would improve the budget process, adding transparency and promoting honest discussion about discretionary spending habits. Take the CHIMPs gimmick which is “capped at a lower amount than was the case in the May debt limit agreement ($15 billion, instead of $25 billion)” according to the latest Johnson-Schumer deal as we explain here. Publicly available reports could help call out irresponsible budget gimmicks like CHIMPs and emergency spending, which are frequently tucked away in annual spending bills. For a summary of Dickerson’s report on budget process reform, check out Budget Process at 50.
Immigration reform can reduce the deficit. Conventional budget estimation assumes legislative proposals will not change the number of workers in the economy. That’s a flawed approach. As Douglas Elmendorf and Heidi Williams explain, a population-change approach “captures the direct budgetary impact of changing the number of people in the United States, in particular by increasing compensation and therefore increasing income and payroll tax revenues.” Under the Penn Wharton Budget Model, exempting employment-based green cards from statutory limits for applicants with graduate degrees would reduce deficits by $129 billion. With the conventional approach, the same policy increases deficits by $4 billion! As Cato’s Alex Nowrasteh, Sarah Eckhardt, and Michael Howard argue in this white paper, “[T]he net fiscal impact of immigrants is more positive than it is for native‐born Americans and positive overall for the federal and state/local governments.” Fiscal hawks should be in favor of immigration, not against it.
Harmful agriculture subsidies. House and Senate Agriculture committees are hoping to advance a farm bill before mid-summer. Crop insurance is at the center of the debate. Tax dollars cover about 60 percent of the insurance premiums farmers pay (see the graphic below). Cato’s Paul Best questions the wisdom of maintaining massive agricultural subsidies writing, “Crop insurance in general can be an important risk management tool for the agricultural industry, but a growing cadre of farmers are pointing to the deleterious effects of subsidizing the insurance, because it can drive up land prices, stifle innovation, harm the environment, squander taxpayer resources, and distort agriculture markets in ways that have serious implications for our food system.”
