Bernie Sanders Blamed Republicans for Our Debt Situation. He’s Only Half-Right.

COMMENTARY Debt

Bernie Sanders Blamed Republicans for Our Debt Situation. He’s Only Half-Right.

Oct 31st, 2018 4 min read
COMMENTARY BY
David Ditch

Research Assistant, Grover M. Hermann Center for the Federal

David is a research assistant in the Grover M. Hermann Center for the Federal Budget at The Heritage Foundation.
Sen. Bernie Sanders, I-Vt., argued in a recent report that the U.S. would have budget surpluses if not for Republican policies since 2000. Larry Burton/ZUMA Press/Newscom

Key Takeaways

Any attempt to assign blame for all of America’s fiscal problems to one party or faction will necessarily have flaws.

By focusing narrowly on taxes and defense, the Sanders report seeks to ignore the enormous impact of entitlement spending on the nation’s bottom line.

Both parties have an obligation to work together to address the primary drivers of America’s impending fiscal crisis and put the nation on a sustainable path.

Bernie Sanders, I-Vt., who sits as the ranking member on the Senate Budget Committee, recently released a report blaming the entirety of the federal government’s fiscal woes since the year 2000 on Republicans.

To put it crudely, he’s half-right. Republicans deserve a significant portion of blame for our transition from budget surpluses to huge deficits. But it took the political priorities of both parties to get us to where we are today.

Politicians are under no obligation to hide their ideological commitments. If anything, more members of Congress should be forthright and clear about their beliefs. Such honesty is usually a trademark of Sanders.

The problem in this report is that Sanders and his staff chose to omit and gloss over key facts.

While there are plenty of ways to criticize Republicans on fiscal policy, any attempt to assign blame for all of America’s fiscal problems to one party or faction will necessarily have flaws.

In the interest of full disclosure, I’ll just note that in my three years working in the Senate, my interactions with Sanders’ staff were uniformly pleasant.

Sanders’ report fixates on two elements of fiscal policy: the 2017 tax cuts and defense spending. He claims that if both of those had remained constant at the levels of 2000, we would now have a surplus.

But changes to the tax code since 2000 have made the system more progressive, not less. While Sanders and other critics of tax reform are correct that high-earners have received a larger dollar benefit per person, millions of lower- and middle-class families now have no income tax obligation whatsoever. Can anyone imagine a better deal than that?

In addition, middle-class Americans in total received a much higher dollar value from tax reform than high-earners. The Sanders report castigates the tax cuts in their entirety, which implies he would support tax hikes on the middle class.

He is well within his rights to advocate these tax increases, but that is not made clear in the report.

Heritage Foundation analysts recently calculated the impact that repealing the 2017 tax cuts would have on Americans from coast to coast, and those numbers would be even larger if the 2001 and 2003 tax legislation were included.

On defense spending, the report is one part erroneous and one part ahistorical. Brian Riedl of the Manhattan Institute produced a substantive response to the report in its entirety. He points out that the Sanders report misstates what the military spending trend was in 2000.

Because the report overestimates the rate at which defense spending was set to decline, their estimate for what defense spending would be today—even absent recent actions to rebuild U.S. forces—is off by tens of billions of dollars.

In addition, the report ignores the overwhelming bipartisan support for the war in Afghanistan following the terrorist attacks on Sept. 11, 2001. In a January 2002 Gallup poll, just 6 percent of Americans thought the war was a mistake. And while there has been an ongoing left-right debate over the extent of the defense buildup since 9/11, there was clear bipartisan support for the initial buildup of the early 2000s.

By focusing narrowly on taxes and defense, the Sanders report seeks to ignore the enormous impact of entitlement spending on the nation’s bottom line.

As a share of the economy, federal spending grew from 17.6 percent in fiscal year 2000 to 20.8 percent in 2017. Over the same period, spending on Medicare, Medicaid, and Social Security grew from 7.3 percent of gross domestic product to 10.5 percent, accounting for the surging net growth in total spending.

Senate Majority Leader Mitch McConnell, R-Ky., was correct when he said that addressing entitlement programs is the most important thing Congress can do to reduce the deficit, and that meaningful reforms will require cooperation across the aisle.

But perhaps the clearest rebuttal to this report comes from the fact that President Barack Obama increased the military presence in Afghanistan (albeit temporarily) and extended the middle-class tax cuts. Both of those policy choices had a fiscal impact, and both had bipartisan support.

It’s encouraging to see Sanders show concern for the nation’s rising deficits and debt. Yet it’s also important to recognize that both parties have voted for tax cuts, increases in discretionary spending (defense and nondefense alike), and have chosen to either ignore or worsen the long-term solvency of Social Security, Medicare, and Medicaid.

There are no easy answers to our current fiscal mess. Both parties have an obligation to work together to address the primary drivers of America’s impending fiscal crisis and put the nation on a sustainable path.

This piece originally appeared in The Daily Signal