How Budget Freeze Is a Cut : Versailles on the Potomac by Arthur Herman
On a chilly morning in March 1788, Louis XVI’s finance minister sat down and drew up what was the first entirely truthful budget of the French monarchy — which … revealed that some 500 millions of revenue were offset by 629 millions in expenses, of which more than 50 percent went for service on the royal debt… It was on that day, not the fall of the Bastille more than a year later, that the ancien régime ended.
Something similar is happening with the current debt-limit imbroglio.
Our Versailles sustains itself on a lie called baseline budgeting.
Created in 1974 by the same Democratic congressional majority that handed over South Vietnam to the Communists and gave us the CAFE standards that ruined the American auto industry, baseline budgeting forced the Office of Management Budget for the first time to consider growing government as the fiscal norm, and reduced spending as an aberration. Even reducing the rate of spending was redefined as subtracting money, not adding money by a slightly lower amount. This has created a system which today’s Congressional Budget Office would score a freeze on all government spending as a $9 trillion cut, even though there’s no reduction in spending at all.
— Arthur Herman is a visiting scholar at AEI.