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- Back in 2012, Senate Majority Leader Mitch McConnell supported Republican calls to rein in and cut government spending, calling the budget deficit "the nation’s most serious long term problem."
- Seven years later, there’s a Republican wielding power at the White House — and the conservative fiscal orthodoxy of cutting government spending, balancing budgets and reducing the national debt have been thrown out the window.
- The GOP’s political rhetoric rung hollow with the two-year budget deal that’s now headed to President Donald Trump’s desk for his signature.
- Manhattan Institute conservative economist Bruce Riedl told INSIDER that the budget deal made Republicans "vulnerable to legitimate charges of deficit hypocrisy."
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Back in May 2012, Sen. Majority Leader Mitch McConnell said then-President Obama needed to become "the adult in the room" in discussions about spending and debt with congressional leaders.
Invoking the severe economic crisis in Greece, McConnell supported Republican calls to rein in and cut government spending, calling the budget deficit "the nation’s most serious long term problem."
Seven years later, there’s a Republican wielding power at the White House — and the conservative fiscal orthodoxy of cutting government spending, balancing budgets and reducing the national debt have been thrown out the window.
The GOP’s political rhetoric rung hollow with the two-year budget deal that’s now headed to President Donald Trump’s desk for his signature. It raises spending by $320 billion over existing spending caps set in a 2011 law, with significant boosts in both military and domestic spending. The bill also lifts the debt ceiling, which is the total amount of money the government can borrow.
Though the American economy is undergoing record-breaking expansion, the bill is expected to help push the budget deficit to over $1 trillion this year for only the second time ever following the Great Recession, and add $1.7 trillion to the federal debt over a decade.
Manhattan Institute conservative economist Brian Riedl told INSIDER that the budget deal made Republicans "vulnerable to legitimate charges of deficit hypocrisy."
It also highlights the extent that Trump has cemented his control over the party. McConnell largely welcomed the budget agreement, though he acknowledged the deal didn’t reflect everything both parties wanted.
Some Republicans, though, tried sounding the alarm about their party’s disregard for deficit and the federal debt, though it amounted to grumbling rather than a full-fledged revolt threatening the budget’s chances of passage.
"You don’t have to be Euclid to understand the math here. We’re like ‘Thelma and Louise’ in that car headed toward the cliff," Republican Sen. John Kennedy told the Washington Post. He joined 22 other Republicans to oppose the deal, many of whom were alarmed over the US debt burden.
Trump tried to address those concerns. Seeking to draw more Republicans into the fold on the budget deal, Trump recently tweeted there is "always plenty of time" to cut government spending.
Reversal to past Republican presidents
Though Trump ran in 2016 bragging about being "the king of debt" and promised to wipe out the national debt within eight years, he’s veered in the opposite direction. He’s racked up $4.1 trillion in debt during his tenure so far — including the 2017 tax cuts pushed through a Republican-controlled Congress that’s projected to cost $1.9 trillion over the next decade, according to the Congressional Budget Office.
"Republicans talk a good game about deficit reduction when they’re out of power," Riedl told INSIDER. "But once they win the White House, they prioritize the more popular policies of cutting taxes and increasing defense spending."
Trump’s fiscal policies are actually in line with past Republican presidents — traditional figures like Ronald Reagan and George W. Bush.
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"George W. Bush inherited a budget surplus and left large deficits. He expanded Medicare without paying for it," conservative economist Michael Strain of the American Enterprise Institute told the New York Times. "Dick Cheney said ‘deficits don’t matter.’ Reagan said that the deficit is big enough to take care of itself. The GOP has not restrained federal spending when it has held the White House."
During the Obama years, Republicans blamed Obama’s fiscal policies for swelling the size of the federal government and hobbling its economic growth. The Tea Party wing of the GOP was especially vocal, charging that Obama’s 2009 stimulus package and the Wall Street bailouts amounted to extraordinary fiscal irresponsibility.
But once the deficit came under $1 trillion, the Tea Party lost the main issues that catapulted it to national prominence, according to Riedl.
"Once the stimulus and the Wall Street bailouts expired and the deficit came back under a trillion dollars, much of the Tea Party lost interest in the deficit," the conservative economist told INSIDER.
In 2016, Trump campaigned against reforming entitlements like Social Security and Medicare, two programs that conservatives had long sought to reform in order to rein in spending and shrink the mounting federal debt — which some Democrats are starting to call for as well.
His victory, Riedl says, convinced many Republicans in Washington that "there’s no longer a constituency for deficit reduction." In other words, voters didn’t care anymore, he says.
And the budget agreement allows Trump to extinguish further debate on the ballooning deficit beyond next year’s presidential election, neutralizing it as a campaign issue.
However, economic experts say that not addressing the growing federal debt is a perilous choice, since it could eventually ripple through the American economy in the form of higher interest rates for businesses and consumers. That increases the cost of borrowing and would eventually lead to reduced private and public investment — while also leaving the government less space to maneuver during a recession.
"Government spending is popular in the short term, but at some point lawmakers need to take ownership for budget trends that are long-term cataclysmic," Riedl says.
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