April 21, 2023
Permission to republish original opeds and cartoons granted.
Limit, Save, Grow will impose discretionary spending caps for about a decade, saving more than $3 trillion, but is it enough?
By Robert Romano
House Speaker Kevin McCarthy (R-Calif.) and the House Republican majority have unveiled their spending plan for the next decade, the Limit, Save, Grow Act, that will be tied to a $1.5 trillion increase in the $31.4 trillion national debt ceiling, the centerpiece of which imposes discretionary budget caps beginning in 2024, but which will be set at 2022 levels, which could save more than $3.2 trillion over the next decade, according to an estimate by the Committee for a Responsible Federal Budget.
While an official score still has not come in from the Congressional Budget Office, the proposal stands out as a promise kept on McCarthy’s part to use the must-pass debt ceiling to restore some semblance of fiscal sanity to the out-of-control federal budget and national debt, the latter of which the White House Office of Management and Budget projects will rise to a gargantuan $50.7 trillion by 2033.
In 2011, former House Speaker John Boehner (R-Ohio) managed to negotiate a similar deal on discretionary spending caps with President Barack Obama — back then it was called Cut, Cap, Balance (although we never got the balance part) — which similarly reduced the budget deficit by hundreds of billions of dollars.
The last time it was done, budget sequestration brought discretionary spending outlays from $1.347 trillion in 2011 to $1.185 trillion in 2016. As a result, the budget deficit shrank from $1.3 trillion in 2011 to a more manageable $584.6 billion by 2016.
The difference back then was that so-called mandatory spending on Social Security, Medicare and Medicaid were at relatively stable levels—the Baby Boomers had not fully retired yet—and so discretionary spending caps could meaningfully reduce the actual budget deficit reported every year.
As it is now, mandatory spending plus net interest owed on the national debt is set to grow by about $3.1 trillion through 2033, from $4.6 trillion in 2023 to $7.7 trillion in 2033, nearly offsetting the discretionary spending caps proposal.
And so, Limit, Save, Grow would go even further, proposing another $1.3 trillion of spending cuts: $500 billion by prohibiting President Joe Biden’s plan to cancel student loan debt, $300 billion by rescinding green energy tax credits and remaining Covid spending, $100 billion by expanding work requirements for Medicaid and food stamps and $500 billion for less interest owed on the national debt thanks to the other spending cuts. The proposal would also eliminate the additional 87,000 IRS agents that were added to the federal workforce by Congress in 2022, which the Center for a Responsible Federal Budget reports would cut taxes by $100 billion.
All told, that’s $4.5 trillion of net spending reductions, and so when factored against the $3.5 trillion baseline increase of total spending, from the current $6.4 trillion in 2023 to $9.9 trillion, should result in deficit reduction of about $1 trillion. Again, we still need to see how the Congressional Budget Office scores the Limit, Save, Grow plan, but that should be in the ballpark, assuming Center for a Responsible Federal Budget’s projections were about accurate.
Now, attention will shift to Senate Republicans, who politically have the ability to either bolster or kneecap their House Republican counterparts on the debt ceiling. Will they be pointing to the dire fiscal outlook, with the national debt set to rise to $50.7 trillion by 2033 if something is not done?
Because in truth, that projection is based on a relatively favorable outlook, especially when you consider the $31.4 trillion national debt has grown on average 8.8 percent a year since 1980. If it keeps going at that rate—a recession or two, another war or two perhaps—it would hit $100 trillion by 2036 or 2037.
Whether $50 trillion or $100 trillion, who is going to buy all those treasuries? Foreigners have been reducing their holdings, and own a declining share of the national debt since the 2007-2009 financial crisis. In the Dec. 2008, foreign central banks and financial institutions owned $3 trillion out of the $9.9 trillion national debt, or 30.8 percent. In Jan. 2023, they owned $7.4 trillion out of the $31.4 trillion debt, or 23.5 percent.
The Federal Reserve has increased its share of the national debt by almost double. The Fed took its share of the debt from $790 billion in Aug. 2007 when the global financial crisis began, or 8.8 percent of the then $8.9 trillion national debt, to $5.28 trillion out of the $31.4 trillion debt as of April 2023, or 16.8 percent.
And then there’s financial institutions, retirement funds, mutual funds and so forth, the largest growing shareholder of the debt that will have to step in, with its share of treasuries rising from about 17 percent in 2008, or $1.7 trillion, to a massive $11.9 trillion, or 38 percent today.
The implication is bigger banks, much bigger banks that will demand a digital currency to avert bank runs as it takes on larger and larger swaths of U.S. treasuries, and a much larger financial system will be needed to accommodate this unprecedented growth of the national debt to offset declining ability to finance our deficits with foreign investment, and an incentive not to do it with outright printing of money by the Federal Reserve. Can you say inflation?
And that is the real danger, as the U.S. economy faces a combination of both inflationary and deflationary forces, with a labor force that shrinks as Baby Boomers retire, resulting in labor shortages but also weaker demand.
Massive monetary accommodations by the Federal Reserve to, for example, shore up the banking system over the next few years could dramatically increase the monetary base again depending on how bad the expected downturn in labor markets is — the Federal Reserve expects 4.6 percent unemployment in 2024, an implied 2 million jobs lost — could result in rising inflation again, which will mean higher interest rates, which will mean all the government’s budget projections were all off. Bet on it.
Meaning, with unemployment still very low at 3.5 percent, Limit, Save, Grow is the only game in town. Now is the time for Congress to do its best to get the fiscal house in order, before there’s another recession and deficits go up all by themselves as millions of jobs are lost and revenues plummet. It’s now or never.
Robert Romano is the Vice President of Public Policy at Americans for Limited Government.
Video: $31 Trillion Debt?! Pass Limit, Save, Grow Act!
To view online: https://www.youtube.com/watch?v=JvJsk_vR09w
Trump Soars Ahead of DeSantis in New Florida poll, a Reversal from November
By Manzanita Miller
A new poll from Victory Insights conducted after the media feeding frenzy over former President Trump’s indictment shows Trump soaring ahead of Governor Ron DeSantis in Florida.
The poll shows Trump with a 15-percentage point lead over DeSantis (47% to 32%), a complete reversal from November when Trump trailed DeSantis by 10 percentage points in the same poll.
In a hypothetical scenario where DeSantis does not run, Trump emerges as the clear frontrunner with 65.9% of the vote. Other declared Republican candidates trail far behind, with Nikki Haley coming in a distant second with 7.8% of the vote. The survey also revealed that 90% of Florida Republicans believe Trump's indictment was politically motivated.
Victory Insights senior pollster Ben Galbraith told National Review this rise in support for Trump could be due to several factors, including the entry of other candidates into the race and Trump's recent indictment by the Manhattan DA. Trump’s indictment appears to have only increased his popularity, and the Trump campaign has raised over $10 million in the days following the indictment.
What’s more, a new CNN poll has the left worried about the public’s overarching belief that politics played a role in the decision to indictment Trump, while many do not believe that Trump broke the law.
“Here are some truly frightening poll numbers”, writes CNN’s Marc Thiessen. “According to CNN, only 37 percent of Americans think that Donald Trump broke the law with his alleged hush money payments to adult-film star Stormy Daniels, while 76 percent think that politics played a role in the decision to bring charges against him.”
Thiessen went on to lament independent voters’ lack of concern over the indictment, noting that just 31% of independents say Trump’s actions were illegal, while 76% say politics played a role in the decision to prosecute him.
As we pointed out last week, Trump appears to be getting a boost among Gen Z and Millennial GOP primary voters in addition to independents. According to the latest YouGov poll, Trump's approval rating is at its highest among younger voters, with a double-digit increase compared to the same poll conducted last October. Currently, Trump has a 46% favorability rating among millennials, which is an increase of 10 percentage points from 36% in October of the previous year. Similarly, his approval rating among Gen Z voters is at 49%, which is up by 14 percentage points from 35% in October of last year.
Recent YouGov polls also show Trump is more popular with younger voters than DeSantis. Over half of GOP primary voters aged 18-29 have a favorable view of Trump (51%) compared to only 43% for DeSantis. Among voters aged 30-44, Trump is favored by 49% while DeSantis has the support of 36%. For voters aged 45-64, Trump leads DeSantis by 7 percentage points. However, voters over 65 prefer DeSantis by 5 percentage points. Two-thirds of young GOP primary voters also support Trump becoming the GOP nominee, according to a recent YouGov poll. Among those who lean right and are under 30, 66% want Trump to become the GOP nominee in 2024, compared to 51-56% of older age groups.
Overall, recent polls suggest that Trump remains a formidable force in the Republican primary race, even in the face of legal challenges and a crowded field of candidates. If anything, Trump has consolidated support since the news of his indictment broke, and DeSantis has fallen in popularity as a bulk of GOP primary voters have consolidated their support for Trump. Independent voters who have less allegiance to Trump still largely believe Trump is innocent until proven otherwise and the vast majority say the indictment was politically motivated.
Manzanita Miller is an associate analyst at Americans for Limited Government Foundation.
To view online: https://dailytorch.com/2023/04/trump-soars-ahead-of-desantis-in-new-florida-poll-a-reversal-from-november/
Judge James C. Ho: Remarks on Justice Thomas and Judge Kacsmaryk
By Josh Blackman
Today, Judge James C. Ho spoke to the Dallas Chapter of the Federalist Society. I am happy to publish his remarks:
Thanks so much to the Federalist Society for the opportunity to speak with you all today. I'm here to briefly respond to recent events concerning the issue of ethics in the judiciary. But I'll begin by admitting my personal bias in these matters.
I had the profound honor of clerking for Justice Thomas from 2005 to 2006. But well before that, I had long concluded that Justice Thomas is one of the most principled and fearless individuals to have ever served in the judiciary. He is a role model—and one of the most inspiring and fascinating Americans alive.
Harlan Crow is a respected business leader, a devoted patriot, and a generous philanthropist. He regularly opens his properties to civic organizations, scholars, and public officials. In fact, he opened his home to me and my family, so that Justice Thomas could swear me in on my first day on the bench. For that, I am eternally grateful. I'm deeply honored to know them both.
* * *
Public service is a public trust. Citizens deserve a government they can believe in. So I warmly welcome any good faith discussion about how to strengthen ethics in government.
But we should apply the highest ethical standards, not hypocritical double standards. It disserves the cause when we allow ethics to be weaponized to punish disfavored viewpoints. No one respects a rigged game.
Unfortunately, I've seen how ethical principles can be contorted and misused—not to serve the public good, but to further a political objective. I'll begin with a personal example.
Last year, I was accused of being unethical for publicly stating my concerns with selecting judges based on race. Four other federal judges testified at the very same hearing where I first spoke. Yet none of them were criticized for being unethical. I can only presume that's because the ethics police agreed with them and disagreed with me.
Had I simply parroted the views favored by cultural elites, I have no doubt that these folks would not have accused me of being unethical. But that's not ethics—that's politics.
* * *
In 2021, The Wall Street Journal alleged that over a hundred federal judges had violated the law by failing to recuse in cases in which they had a financial interest.
Notably, the Journal did not accuse all of those judges of actual corruption—of actually deciding cases to further their own interests. That's an important distinction to draw. Because there's a big difference between actual corruption and the appearance of corruption.
That's not to say that appearances aren't important, too. It's vital that citizens have confidence in their judiciary. As judges, we don't have the purse or the sword. All we have is our credibility with the American people.
But we should recognize what the Journal did and did not conclude. It showed that judges are imperfect human beings, like everyone else. But I don't recall anyone calling for all of these judges to be impeached or punished.
* * *
Many Supreme Court Justices have enjoyed many trips hosted by individuals and organizations that may not have a direct interest in a pending case, but no doubt care deeply about certain cases, as surely every American does. Yet no one has said that that's enough to trigger recusal, as was the case in the Wall Street Journal article.
If we want to strengthen disclosure requirements, we can certainly do that. And if we want to categorically prohibit judges from accepting trips from others, we can do that as well.
But whatever we do, I think it would be inaccurate to automatically presume some sort of illicit motive. Many people genuinely enjoy spending time with—and learning from—interesting people who do interesting work. Judges aren't the only ones invited on trips. Scholars and journalists are, too. I was recently invited to Florida to speak to a respected nonpartisan organization—along with a number of distinguished law professors and journalists. Was everyone there to gain corrupt influence with members of the academy and the media? Surely not. And for the same reason, we shouldn't assume illicit motive with every Justice who accepts a trip.
And we certainly shouldn't assume illicit motive just because we happen to disfavor one's views. Again, that's not ethics—that's politics. And it's part of the same problem we're seeing in law schools across America. We're increasingly teaching people to presume bad faith and malicious intention from anyone we disagree with.
* * *
People are doing the same thing to my friend Judge Matt Kacsmaryk.
To understand, you have to remember this: The Justice Department instructs every potential judicial nominee to stop making any public statements of any kind.
When my own nomination was imminent, a reporter wanted to talk to me about a big case that I had just won for a client. He wanted to give me some "Litigator of the Week" recognition, but needed a quote from me before he could do it. The Justice Department instructed me not to talk to the reporter. So I dutifully obeyed. I have no doubt Judge Kacsmaryk was doing exactly the same thing—following instructions.
And there's nothing wrong with those instructions. Consider this analogy: Imagine that someone was thinking about becoming general counsel of a controversial political group. But they never did it, because they were nominated for a judgeship. Nominees aren't required to disclose future jobs that they don't end up taking. Nor are they required to disclose future articles that they don't end up authoring.
I presume that Judge Kacsmaryk would not be required to disclose the article if he had simply withdrawn it altogether. After all, a document isn't final until it's final. And if it had been a solo effort, I imagine that he would've withdrawn it.
But this was a joint effort. And given that it was a joint effort, I see no reason why Judge Kacsmaryk couldn't just let his co-authors proceed without him. I don't see why all their efforts had to go to waste. I can imagine Judge Kacsmaryk just felt bad for his colleagues.
There's nothing wrong or unusual about lawyers who work together on a document, knowing full well that some of them may not end up signing and getting public credit for the product. That's what law clerks do for judges. How many law firm associates have ever contributed to a document that they didn't end up signing—such as a motion or brief or article or speech or client alert? My guess: All of them.
This is such a common phenomenon that there's a name for it. It's called ghostwriting. Now, if the Senate wants to amend its forms to require disclosure of all ghostwritten material, it certainly can do so. But that would be new. Former Senate lawyer Stephen Breyer was not required to disclose everything he ghostwrote for Senator Ted Kennedy.
* * *
I'm all for discussing ways to strengthen ethics in government. But we should do it in good faith. And our discussions should be proportionate to the facts.
During the 2016 Presidential election, Justice Ginsburg made a series of highly disparaging remarks about Donald Trump. She called him a "faker." She criticized the media for not looking into his tax returns. And she said that "I can't imagine what this place would be—I can't imagine what the country would be—with Donald Trump as our president."
A few years earlier, she told the New York Times that, "at the time Roe was decided, there was concern about population growth and particularly growth in populations that we don't want to have too many of."
Suffice it to say that these are highly unusual statements for a sitting Supreme Court justice. Yet she did not recuse herself in countless cases involving either abortion or President Trump.
Even so, President Trump later described Justice Ginsburg this way: She led an amazing life and was an amazing woman, whether you agreed with her or not.
Well, here's what I would say about Justice Thomas: He is an amazing man, and his life exemplifies the American Dream, whether you agree with him or not.
By all means, let's talk about what we can do as a country to strengthen ethics in our government. But we can do it without the double standards. We can do it consistently, not selectively. And we can do it without tearing down an honorable man like Justice Thomas. Thank you.
I will have more to say about these matters in due course.
To view online: https://reason.com/volokh/2023/04/18/judge-james-c-hos-remarks-on-justice-thomas-and-judge-kacsmaryk/