March 27, 2017

Trump Needs a Wall of Fiscal Discipline

In an interview on Fox News last week, President Trump said that he would like to have a balanced budget “eventually,” but not at the expense of higher spending for the military.

“So a balanced budget is fine,” Trump said. “But sometimes you have to fuel the well in order to really get the economy going. And we have to take care of our military. Our military is more important to me than a balanced budget because we’ll get there with a balanced budget.”

This brief window into the president’s thinking on budget policy is troubling because it indicates that he does not feel constrained by the need to make trade-offs in pursuit of his policy goals. It is an invitation to pit any worthy initiative against the goal of a balanced budget regardless of the cost.

That is a false choice and one that has potentially harmful consequences for budget discipline.

As new projections by the nonpartisan Congressional Budget office (CBO) show, current policy is already on track to add another $9.4 trillion of borrowing to the nation’s growing debt over the next 10 years.

With that sobering outlook in mind, Trump’s recent comment raises the question: What else fits into the president’s list of priorities ahead of a balanced budget?

There are many possibilities such as infrastructure spending, border security and the “massive” tax cut he has promised.

All to be done, apparently, without touching Social Security and Medicare, which comprise half of the projected spending growth over the next 10 years.

If some of Trump’s goals are more important than a balanced budget, what about the priorities that others might have? Once the need for trade-offs is cast aside, fiscal policy becomes nothing more than a search for votes.

It is certainly true that some things are more important than a balanced budget. But fiscal policy cannot remain forever on a course that is unsustainable. Rather than waving off the balanced budget goal as something that we’ll get to eventually, it would be better for the president to warn everyone that new initiatives must be paid for and that hard choices must be made to accomplish this.

Fiscal discipline is a full-time occupation that should be applied to all parts of the budget.