Last week Ezra Klein interviewed Michael Ettlinger and Michael Linden, the authors of a paper called “One Thousand Cuts” that examines how specific spending cuts could help reduce the deficit. As Ezra points out, “for all the talk of spending cuts, there’s very little specificity in the discussion.” Turns out one of the must fruitful areas for spending cuts is the defense budget:
“Defense was given almost a blank check in the last decade. There was obviously a need to ramp up spending because of the wars, but we way overshot the mark. We’re spending more, in real terms, than we have at any time since the beginning of World War II — more than during the Cold War or Reagan’s buildup. And if you talk to people who really understand our national security needs, they’ll acknowledge there’s a lot we can cut back on defense.
This seems about right to me. The other thing to bear in mind is that healthcare expenses are the biggest drag on the deficit (this chart that Ezra puts up highlights that nicely), but what differentiates this from the defense budget is that it doesn’t really contain any waste. Most healthcare outlays are productive, but since these outlays are huge and will only continue to grow (due to rising insurance premiums), they will occupy a large and growing percentage of the deficit. The solution to this is to bring down actual healthcare costs, a problem the Affordable Care Act begins to tackle. But we need a lot more than just the ACA, which means that healthcare reform isn’t over yet!