Newsletters

Newsletter 97 - Spring 2020



Let's hear it for smaller, more focused, less costly government!

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Political overhaul
Term limits
Balanced budget amendment
Congressional budget system
Offshore wind power
Hang in there
About SAFE

Political overhaul – SAFE isn’t alone in advocating changes in America’s political system to make Congress more effective and curb Executive Branch overreach, but some of the suggested approaches seem rather simplistic.

Consider a recent letter to members of the US Senate. The basic problem resides in the Senate, said the signers (70 former US senators), where partisan gridlock has resulted from misuse of the filibuster rule and a diminished willingness to arrive at the compromises required for effective legislation. The Senate is failing to perform its constitutional duties, Washington Post,
2/25/20.

Curiously, this letter ignored an obvious possibility – do away with the filibuster rule. Also, how could a bipartisan caucus in the Senate prevail over partisan rivalries, especially during periods of divided government? Note that there have been only four years of united government since 2006: Democrats controlled the White House and both houses of Congress in 2009-10; the GOP did so in 2017-18.

Congress has 535 individually elected members of two different houses representing diverse states/districts. The issues under discussion are complex, the “right answers” aren’t necessarily in the middle, and such an unwieldy body does not seem well suited for making decisions. Who is in charge and why does anyone have to listen to them? Witness the overwhelmingly negative results achieved in DC since the return of divided government in January 2019, e.g., a botched impeachment process and the appalling disunity that has been displayed during the coronavirus crisis.

The government can work if strong presidential leadership (the accelerator, if you will) is available to provide a sense of direction, while Congress has the power to adjust the details or hit the brakes. It’s particularly important to improve the budget process. To these ends, we envision several constitutional amendments plus revisions to the congressional rules.

Highlights of our proposals are presented in this newsletter. Feedback would be welcomed; please direct it to
wwhipple3@verizon.net.

Term limits – George Washington retired after two terms, giving rise to a tradition that prevailed until FDR ran for a 3rd term (and then a 4th term) under the exigencies of World War II. The Constitution was amended in 1951 to formally establish a two-terms limit for presidents.

Congressional term limits have never existed, and some members serve for decades. Long-termers seem increasingly disposed to focus on gratifying large donors and supporters versus representing their constituents generally or the interests of the nation as a whole.

A reasonable limit would seem to be 12 years of service in either the House (6 terms) or Senate (2 terms). Some 150 members of the
House and 30 members of the Senate are currently over these limits, per Wikipedia, indicating the magnitude of increased congressional turnover that might result.

Balanced budget amendment – The members of Congress are seemingly not inclined to balance the government’s budget. Soaring deficits and debt have become the norm, and the consequences will predictably be disastrous.

To restore order, fiscal conservatives have proposed a constitutional amendment prohibiting Congress from approving a budget in which outlays exceed revenue. For such a balanced budget amendment (BBA) to work, however, several issues would have to be resolved.

•With annual deficits currently running about $1 trillion dollars (plus a ton of coronavirus relief spending), a phase-in plan would seem essential. Our thought would be to seek a commitment of the nation’s political leaders to balance the budget within five years, with the BBA to become effective after they did so in order to avert a relapse.

•Shouldn’t there be an exception for wars or national disasters? Surely no one could expect the government to balance the budget during a world war, for example, but where would one draw the line between such a war and lesser conflicts? The solution, we think, would be to provide for an override of the balanced budget requirement by a 2/3 majority of both houses of Congress.

•The budget could be balanced by spending discipline, tax increases, or a combination thereof. To tilt the scales in favor of spending discipline, we would propose that the BBA require a 2/3 majority in both houses of Congress to increase tax rates or impose new taxes (but not to eliminate temporary tax credits; it’s hard enough to get rid of these “extenders” already).

•The members of Congress would be unlikely to propose term limits and a BBA on their own initiative, so an Article V convention would probably be required.

A concerted effort to enlist the required number of states (at least 34) to support a call for such a convention is underway, and at this point is about halfway to meeting the goal. Congratulations to the
Convention of States Action team if they can pull it off!

Congressional budget system – The budgeting process has two phases: (a) estimate overall revenues and outlays for major sectors of the government, and (b) appropriate funds for the numerous government units and programs whose funding is budgeted on an annual basis. Step (b) leaves out benefits paid based on statutory criteria, interest expense, etc. Such “mandatory” outlays represent about 2/3 of the government’s total spending.

The first step is a logical prerequisite for the second as appropriators must know how much money is available before they can responsibly do their jobs.

#Step (a): Presidential budget proposals (PBPs) are developed by the Office of Management and Budget (OMB) and labeled Budget[s] of the U.S. Government. To present a complete picture, PBPs include estimates for mandatory outlays. They are generally submitted in February (April in a new president’s first year).
PBPs are comprehensive budget documents, with considerable supporting detail including 10-year projections of the government’s fiscal position. They lack official standing under the congressional budget rules, however, and are often given short shrift by the members of Congress.

Congressional budget rules call for the House and Senate to pass budget resolutions, which can then be reconciled to produce a unified congressional budget resolution by May. The two houses often fail to pass budget resolutions, however, let alone agreeing on a unified version. No sanctions apply for non-compliance.

#Step (b): House and Senate appropriators start work on a dozen or so discretionary spending bills by June. If congressional budget resolutions are not available, they fall back on baseline spending projections of the Congressional Budget Office. The CBO’s projections routinely assume spending growth in all sectors.

Under the congressional budget rules, spending bills are supposed to be passed by the House and Senate, reconciled, and presented to the president for signature before the October 1 start of the new fiscal year.

Spending bills are rarely prepared on time, however, so continuing resolutions are needed to keep the government open. It’s par for the course to have omnibus spending bills presented in mid-December or later without adequate time for the members of Congress to review and debate the provisions (typically loaded with unrelated “riders”). See, e.g., More shutdown drama, mediocre results, SAFE blog,
2/12/18.

#Proposed fixes: The aforesaid procedures are woefully inadequate for managing a nearly $5 trillion annual budget. OMB efforts are largely wasted – congressional budget work is neither rigorous nor timely – spending discipline is weak. No wonder so many critics have described the budget system as “broken.”

Re step (a), it would be helpful to remind all concerned that budgeting is a joint Congress/Executive Branch responsibility. To this end, the congressional budget rules should be amended to make a PBP the default budget resolution unless Congress adopted its own resolution within 60 days after receipt thereof.
To speed up step (b) and improve the results, abolish the Senate filibuster rule, which has been routinely used by whichever party was in the Senate minority to hold spending bills hostage in order to force consideration of their own legislative priorities. Also, timely completion of spending bills should be affirmatively encouraged

For example, House and Senate appropriators could be required to continue work in August until their respective bills were completed and ready for floor action in September.

Another possibility would be to automatically extend spending authority into the new fiscal year to avert a government shutdown, but do so at the current (versus proposed, and probably higher) levels without any possibility of a catchup adjustment later.

Finally, abolish the debt ceiling. Debt can’t be controlled by setting a limit that would necessarily be raised if deficits continued; that’s like “locking the barn door after the horse has been stolen.”

Offshore wind power – SAFE director John Nichols gave a February 21 talk to the Retired Men’s Luncheon Club on the Skipjack Wind Farm, an offshore wind-power project that has received approval from Maryland regulators. This is one of several offshore wind projects pending in our neck of the woods, so far without Delaware participation.

The Skipjack developer has been negotiating with Delaware regulators (DNREC) for rights to bring the power ashore and connect it to the electric power grid on Fenwick Island. In return, some $15 million would be provided for enhancing state park infrastructure.

A public hearing was recently conducted in Oceanview, DE, drawing a “rowdy crowd” of about 200 people. News Journal,
11/21/19.

Residents questioned the effects on the marine environment of these large structures (about 850 feet tall) and high voltage transmission lines. They also didn’t favor additional development on Fenwick Island, a delightfully unspoiled area. Why not bring the power ashore in Maryland?

Other critics (notably in Ocean City, MD) have complained that wind turbines of Skipjack and another project approved by MD regulators would be visible from shore, reducing the area’s appeal for tourists. Why not locate them further out?

Effects of offshore wind projects on the cost and reliability of electric power have been largely ignored by the general public and media, but may be more important than the points that have been raised.

Wind turbines don’t use fuel, but the capital costs are high. Over the life of a project, per government estimates, the “levelized cost” of land-based wind power is roughly comparable to the cost of fossil fuel or nuclear power whereas offshore wind power costs about twice as much.

Being intermittent (available roughly 1/3 of the time), wind power must be backed up by reliable energy sources (fossil fuel or nuclear) so electric power will be available 24/7. If too much wind power is fed into the grid, reliable energy sources will have to be switched on and off – making them more expensive.

New York is currently being forced to institute subsidies for nuclear power plants in order to keep them open. The same issue may arise for other nuclear plants (e.g., Calvert Cliffs, MD) if the proposed offshore wind projects are built.

An economic case for offshore wind must rest on the manmade global warming theory. Nichols recommended
Tony Heller’s videos (realclimatescience.com) for those who would like to bone up on the subject.

The audience seemed to be following the presentation. One person asked why government leaders who profess to be concerned about global warming aren’t pushing nuclear energy versus wind and solar as the solution. Great question!

Hang in there – Never underestimate the power of positive thinking, and here’s a dramatic story to underscore the point. Nervous? Nope, Patrick Mahomes predicted the Chiefs' Super Bowl comeback, Dan Wetzel, yahoo.com, 2/3/20.

About SAFE - SAFE is a non-partisan, all-volunteer organization that was founded in 1996. We advocate smaller, more focused, lower cost government, to be achieved by cutting spending, restructuring “entitlements,” simplifying taxes, and rationalizing regulations.

SAFE BOARD OF DIRECTORS
Andrew Betley, (302) 239-9679
Suzie Dickson
John Greer, (302) 479-0485
Dan Kerrick, treasurer, (302) 521-4272
Steve McClain, (302) 998-3910
Jerry Martin, (302) 478-5064
John Nichols, (302) 743-2783
rycK Stout, (302) 478-9495
Bill Whipple, president, (302) 464-2688
For e-mail addresses see
LINK.

The SAFE agenda is promoted through: (1) Our website, including policy statements, a weekly blog, and a “Delaware Chatter” microblog; (2) Letters to the editor, public events, legislative contacts, etc., which are also posted and/or recapped on the website; (3) This quarterly newsletter, available in print (since 1996) and now electronic editions; and (4) Posts on Twitter and/or Facebook (click icons on the website to access).

SAFE dues are $10 per year for subscribers to the print edition of the newsletter and zero for electronic subscribers. Contributions are also appreciated and may be tax deductible (SAFE is a Section 501(c)(3) non-profit organization).

To join SAFE, renew your membership, or make a contribution, please print and complete this
form and mail it with your check to SAFE, 115 Dungarvan Drive, Wilmington, DE 19709. Thank you!