Pay for the Wars

April 8, 2011 Topic: EconomicsCongressDefense Region: LibyaUnited States Blog Brand: The Skeptics

Pay for the Wars

Senator Franken's resolution aims to stop Congress from funding wars with deficits. It's a good idea that doesn't go far enough.

Senator Al Franken (D-MN) Wednesday introduced his Pay for War Resolution, which would require this Senate to offset war spending with spending cuts or tax increases unless 60 senators vote to override the requirement. As I discussed in a recent post, we know from markets that subsidized products will outsell alternatives of higher quality. Deficits essentially use future wealth to subsidize war spending, screwing up our evaluation of its costs and benefits.

Of course, that is true of all present spending, not just wars. So why focus only on them? One answer is that you don’t have too—you can be for this bill and efforts to make deficit spending extraordinary. The other answer is that, absent a draft, wars belong to the category of policies with especially distributed costs and thus no natural opponents. They are different in this sense from environmental regulations, for example, which provoke complaints from businesses that bear much of their cost. Professional norms prevent the volunteers that fight our wars from complaining too publicly about them. The cost to the rest of us is marginally higher taxes, now subsidized by deficits. The result is that few care enough to organize for change. We need more skin in the game for productive debate.

Still, I have two problems with Franken’s resolution.

First, the supermajority required to override the offset requirement is too small. The Senate often struggles to gather sixty votes, but most wars would likely get that at their outset, even the mess underway in Libya. Two-thirds would be a better number.

Second, presumably to make the bill more politically viable, Franken carved out planned spending on the wars for Iraq and Afghanistan. If spending on those wars declines as budgets now assume, they would be exempt from the bill’s bite. Still, should our Afghanistan adventure exceed planned costs, it would qualify, which might at least create better debate about its worth.

Far less sensible is a House bill to pay for the war in Libya with non-security offsets. The legislation, offered by Roscoe Bartlett (R-MD) and co-sponsored by Dennis Kucinich (D-OH), and Ron Paul (R-TX), requires the Defense Department to estimate what it spent bombing Libya and Congress to cut funding from discretionary accounts excluding DoD, Homeland Security, and Veterans to cover those costs.

Aside from its singular focus on Libya, the trouble with this bill is that it would heighten party division on the war. If the bill passes, anyone that wants to cut domestic spending, a group including most Republicans, could use the war in Libya to so. People on the fence about the merits of the war might then support it. Democrats eager to defend those programs will break the other way. The bill would be vastly improved by letting the offsets come from any source.