On this episode of newch World. President Joe Biden signed Congress's one point two trillion dollars spending package on March twenty third, twenty twenty four, which will keep the government funded through October first, almost halfway into the fiscal year. The passage of the bill ends a month long struggle in Congress to secure a permanent budget resolution instead of passing stopcap measures. Several of the last minute measures nearly led to a government shutdown. But hidden within the pages of this four hundred page bill are plenty of earmarks, also called pork barrel spending. That is, when you're represented in Congress requests direct government spending for projects in their district. Here to talk about the spending bill, I'm really pleased to welcome my guest, David Ditch. He is a senior policy analyst and the Grover M. Hermann Center for the Budget at the Heritage Foundation. David, welcome, and thank you for joining me in the News World.

On this episode of newch World. President Joe Biden signed Congress's one point two trillion dollars spending package on March twenty third, twenty twenty four, which will keep the government funded through October first, almost halfway into the fiscal year. The passage of the bill ends a month long struggle in Congress to secure a permanent budget resolution instead of passing stopcap measures. Several of the last minute measures nearly led to a government shutdown. But hidden within the pages of this four hundred page bill are plenty of earmarks, also called pork barrel spending. That is, when you're represented in Congress requests direct government spending for projects in their district. Here to talk about the spending bill, I'm really pleased to welcome my guest, David Ditch. He is a senior policy analyst and the Grover M. Hermann Center for the Budget at the Heritage Foundation. David, welcome, and thank you for joining me in the News World.

Thanks for having me.

Thanks for having me.

Prior to joining Heritage, you were a budget analyst for the Senate Budget Committee, where you oversaw appropriations. With that background, will you walk us through the general process of funding the federal government.

Prior to joining Heritage, you were a budget analyst for the Senate Budget Committee, where you oversaw appropriations. With that background, will you walk us through the general process of funding the federal government.

Every year sure, So typically the first step is that federal agencies put together documents in conjunction with the presidential administration, and they end up putting together what's called the Presidence budget. This provides Congress with lots of information about both the functioning of the agencies, what they're doing, how they've been using the money, and also what theministration would like to prioritize. Traditionally, Congress uses the agency guidance to help inform them, but they tend to ignore what the president is asking for unless the President and Congress are both controlled by the same party, which this year is obviously not the case when you have Joe Biden sitting in the Oval Office and Republicans having taken over the House of Representatives. After this, ideally both the House and the Senate will produce budget resolutions to determine how they're going to spend money for the following year, but unfortunately that increasingly doesn't end up happening, especially when there's a party split between the House and the Senate. Republicans have tended to try to produce budget resolutions responsibly. Democrats tend to see that as a technical issue that they aren't overly concerned about one way or another. Congress ends up establishing a spending level, and then a portion of the spending called discretionary spending, which is what funds the normal operation of federal agencies like the Department of Defense, the Department of Health and Human Services, and so on. What we're called appropriation committees use the budgetary limits that have been established and figure out how they want to divide up this part of the federal budget between all the different agencies and programs. Of course, what's unfortunate is that the portion of the federal budget that Congress spends the most time on is becoming a smaller and smaller portion of what the federal government spends. Because in addition to these discretionary programs, there are also mandatory programs that operate almost entirely on autopilot. So for example, social Security, medicare, medicaid, food stamps. These programs take up an increasing share of the federal budget and are growing very rapidly relative to the size of the economy.

Every year sure, So typically the first step is that federal agencies put together documents in conjunction with the presidential administration, and they end up putting together what's called the Presidence budget. This provides Congress with lots of information about both the functioning of the agencies, what they're doing, how they've been using the money, and also what theministration would like to prioritize. Traditionally, Congress uses the agency guidance to help inform them, but they tend to ignore what the president is asking for unless the President and Congress are both controlled by the same party, which this year is obviously not the case when you have Joe Biden sitting in the Oval Office and Republicans having taken over the House of Representatives. After this, ideally both the House and the Senate will produce budget resolutions to determine how they're going to spend money for the following year, but unfortunately that increasingly doesn't end up happening, especially when there's a party split between the House and the Senate. Republicans have tended to try to produce budget resolutions responsibly. Democrats tend to see that as a technical issue that they aren't overly concerned about one way or another. Congress ends up establishing a spending level, and then a portion of the spending called discretionary spending, which is what funds the normal operation of federal agencies like the Department of Defense, the Department of Health and Human Services, and so on. What we're called appropriation committees use the budgetary limits that have been established and figure out how they want to divide up this part of the federal budget between all the different agencies and programs. Of course, what's unfortunate is that the portion of the federal budget that Congress spends the most time on is becoming a smaller and smaller portion of what the federal government spends. Because in addition to these discretionary programs, there are also mandatory programs that operate almost entirely on autopilot. So for example, social Security, medicare, medicaid, food stamps. These programs take up an increasing share of the federal budget and are growing very rapidly relative to the size of the economy.

Let me stop you for a second, as I understand why, for example, social security or medicare is hard to touch, but why are food stamps mandatory?

Let me stop you for a second, as I understand why, for example, social security or medicare is hard to touch, but why are food stamps mandatory?

That's a very good question to me. We should try to determine how to prioritize what the federal government does across the board. There shouldn't be certain things that are all limits. As you mentioned food stamps are considered mandatory. Congress should be able to say, based on the economic conditions, we think this is an appropriate amount of money to spend, and tell the executive branch and tell the states, Okay, we want you to spend this money based on these guidelines. But it's easier for the elected officials to move as many things as they can off to the side, put them on autopilots so that they don't have to worry about them.

That's a very good question to me. We should try to determine how to prioritize what the federal government does across the board. There shouldn't be certain things that are all limits. As you mentioned food stamps are considered mandatory. Congress should be able to say, based on the economic conditions, we think this is an appropriate amount of money to spend, and tell the executive branch and tell the states, Okay, we want you to spend this money based on these guidelines. But it's easier for the elected officials to move as many things as they can off to the side, put them on autopilots so that they don't have to worry about them.

But of course that just means you have escalators that are uncontrollable. They go up every year.

But of course that just means you have escalators that are uncontrollable. They go up every year.

Kicking the can down the road has been sort of the default in a lot of areas of federal policy for a long time now, and that's part of why the hole that we are in right now has gotten so deep.

Kicking the can down the road has been sort of the default in a lot of areas of federal policy for a long time now, and that's part of why the hole that we are in right now has gotten so deep.

So you have those things which are already permanently funded in effect, often with an escalator clause attached either to number of people or other kind of things, to the inflation rate, for example. Then you have what's called discretionary, which is the amount that is relatively easy for Congress to control, except that it doesn't control it. Explain that to us man, why have we been on the steady upward cycle which I sort of understood during COVID, but I thought COVID was going to be kind of a peak, and then we go back down to the norm and the Democrats have managed to turn it into a plateau, and we're now spending I think, a bigger share of money through the federal government than ever in American history.

So you have those things which are already permanently funded in effect, often with an escalator clause attached either to number of people or other kind of things, to the inflation rate, for example. Then you have what's called discretionary, which is the amount that is relatively easy for Congress to control, except that it doesn't control it. Explain that to us man, why have we been on the steady upward cycle which I sort of understood during COVID, but I thought COVID was going to be kind of a peak, and then we go back down to the norm and the Democrats have managed to turn it into a plateau, and we're now spending I think, a bigger share of money through the federal government than ever in American history.

So, from about two thousand through to twenty twenty, interest rates on the national debt were steadily going down, and a lot of members of Congress and most of the presidential administrations over that time saw that to mean that it was a pre launch. They could spend whatever they want, they could add whatever they wanted to the national debt, and there weren't going to be consequences, and they went as far as they could. And then after the pandemic happened, after what I determined to be a seven point five trillion dollar spending spree, that's trillion with a T, they went so overboard. Debt markets were not able to absorb all of it, which was led to not only higher interest rates on the national debt, interest rates we haven't seen in many years, leading to the cost of maintaining the national debt hitting record levels, but the overspending also, I believe was the number one factor driving the inflation that we saw in twenty twenty one in twenty twenty two, and the reason why inflation is still so much higher today. The interest rates might never come back down. Unfortunately, so many members of Congress feel entitled to a certain amount of spending every year on all their different pet programs and all their pandouts to all their special interests. They can't even conceive of getting rid of even the smallest programs. One of my favorite examples is that there's a special program within the Department of Agriculture to subsidize maple syrup, which pretty much just goes to the state of Vermont. If you were to say, Okay, the federal government has tens of trillions of dollars in debt, Social Security and medicare are going to go bankrupt in the next decade. What can the American people afford to get rid of within the federal government. I feel like something like the maple syrup program would be pretty easy to just sort of lop off. But nothing can ever be allowed to go away. Nothing ever gets eliminated. And because every few years, especially when Democrats are in power, you have new bureaucracies being created, new programs, and those always operate indefinitely, so called discretionary side of the spending equation that keeps going up and up and up.

So, from about two thousand through to twenty twenty, interest rates on the national debt were steadily going down, and a lot of members of Congress and most of the presidential administrations over that time saw that to mean that it was a pre launch. They could spend whatever they want, they could add whatever they wanted to the national debt, and there weren't going to be consequences, and they went as far as they could. And then after the pandemic happened, after what I determined to be a seven point five trillion dollar spending spree, that's trillion with a T, they went so overboard. Debt markets were not able to absorb all of it, which was led to not only higher interest rates on the national debt, interest rates we haven't seen in many years, leading to the cost of maintaining the national debt hitting record levels, but the overspending also, I believe was the number one factor driving the inflation that we saw in twenty twenty one in twenty twenty two, and the reason why inflation is still so much higher today. The interest rates might never come back down. Unfortunately, so many members of Congress feel entitled to a certain amount of spending every year on all their different pet programs and all their pandouts to all their special interests. They can't even conceive of getting rid of even the smallest programs. One of my favorite examples is that there's a special program within the Department of Agriculture to subsidize maple syrup, which pretty much just goes to the state of Vermont. If you were to say, Okay, the federal government has tens of trillions of dollars in debt, Social Security and medicare are going to go bankrupt in the next decade. What can the American people afford to get rid of within the federal government. I feel like something like the maple syrup program would be pretty easy to just sort of lop off. But nothing can ever be allowed to go away. Nothing ever gets eliminated. And because every few years, especially when Democrats are in power, you have new bureaucracies being created, new programs, and those always operate indefinitely, so called discretionary side of the spending equation that keeps going up and up and up.

So in a sense, save our syrup program becomes a major battle cry. Yeah, so we have a maple syrup program. Do we have a molasses program?

So in a sense, save our syrup program becomes a major battle cry. Yeah, so we have a maple syrup program. Do we have a molasses program?

I don't know that we do, but I'm sure there's something comparable in there. So on the one hand, there are some people when they talk about the federal budget, all they want to talk about are the benefit programs. But I believe that there's not a proper understanding of what's going on inside a lot of these federal agencies, the kind of damage that's being done. I've done some research over the last few months looking at agencies like the Spartment of Education, National Science Foundation that are promoting a lot of deeply radical left wing ideology, the critical race theory, very transgender ideology aimed at children. These are parts of the federal government, where if you ask the average person what these agencies are doing, it's not going to seem like they're controversial. But when you look at how they're operating now, especially under the Biden administration, it's not just that they're wasting tax dollars. It's that they're using tax dollars to undermine America's fundamental values. And in turn, these are agencies that, through the discretionary spending process, have been steadily getting more and more and more money with bipartisan support year after year.

I don't know that we do, but I'm sure there's something comparable in there. So on the one hand, there are some people when they talk about the federal budget, all they want to talk about are the benefit programs. But I believe that there's not a proper understanding of what's going on inside a lot of these federal agencies, the kind of damage that's being done. I've done some research over the last few months looking at agencies like the Spartment of Education, National Science Foundation that are promoting a lot of deeply radical left wing ideology, the critical race theory, very transgender ideology aimed at children. These are parts of the federal government, where if you ask the average person what these agencies are doing, it's not going to seem like they're controversial. But when you look at how they're operating now, especially under the Biden administration, it's not just that they're wasting tax dollars. It's that they're using tax dollars to undermine America's fundamental values. And in turn, these are agencies that, through the discretionary spending process, have been steadily getting more and more and more money with bipartisan support year after year.

If you would, Devid, tell me about some of the more outrageous earmarks that you found.

If you would, Devid, tell me about some of the more outrageous earmarks that you found.

There were two earmarks, one that goes to a group in Rhode Island, another that goes to a group in New Hampshire. The way that they're labeled is very in a fact, But then when you look at what these groups actually do, these organizations that provide late term abortions, and this is over two million taxpayer dollars going to these organizations. Even if the money isn't directly for abortions, money is fungible, and the federal support for these organizations helping to keep the doors open and keep the lights on, means that taxpayers are de facto subsidizing these abortions.

There were two earmarks, one that goes to a group in Rhode Island, another that goes to a group in New Hampshire. The way that they're labeled is very in a fact, But then when you look at what these groups actually do, these organizations that provide late term abortions, and this is over two million taxpayer dollars going to these organizations. Even if the money isn't directly for abortions, money is fungible, and the federal support for these organizations helping to keep the doors open and keep the lights on, means that taxpayers are de facto subsidizing these abortions.

Well, I think it's particularly egregious when you start talking about late term, you know, in the eighth and ninth month, sometimes even on the last day. It's just remarkable.

Well, I think it's particularly egregious when you start talking about late term, you know, in the eighth and ninth month, sometimes even on the last day. It's just remarkable.

Yeah, And obviously there remains a very heated debate about abortion, about what the legal status should be in the country. I feel like, at a bare minimum, we should be able to agree that people shouldn't be forced to go against their conscience. People who are pro life shouldn't be forced by the IRS to provide their hard earned tax dollars to the federal government and then have the federal government turn around and help prop up abortionists.

Yeah, And obviously there remains a very heated debate about abortion, about what the legal status should be in the country. I feel like, at a bare minimum, we should be able to agree that people shouldn't be forced to go against their conscience. People who are pro life shouldn't be forced by the IRS to provide their hard earned tax dollars to the federal government and then have the federal government turn around and help prop up abortionists.

Why are Republicans so weak on controlling government.

Why are Republicans so weak on controlling government.

You have some Republicans, the more conservative wing, who are willing to go to the mat on spending. Unfortunately there's only so many of them. When you head more towards the left flank of the GOP, you have many members who are not just passively willing to accept a bigger government. You have many members who actively enjoy seeing the federal government grow, seeing these frederal bureaucracies obtain more power, obtain more control over more parts of our day to day lives. Frankly, I don't understand the appeal some of these members who will talk about how wonderful business investment is, how important it is to have a pro gross tax code. They'll say that on one hand, then on the other hand, you look at the legislation that they're supporting, whether it becomes law in some cases even it doesn't become law. But they consistently also support growing the federal behemoth, deepening the swamp in Washington, d C. They're going against what they claim to be in favor of. But ultimately, one of the saddest realities about Washington is the easiest way to tell whether a piece of legislation is going to become law is if it increases spending and has Republican support.

You have some Republicans, the more conservative wing, who are willing to go to the mat on spending. Unfortunately there's only so many of them. When you head more towards the left flank of the GOP, you have many members who are not just passively willing to accept a bigger government. You have many members who actively enjoy seeing the federal government grow, seeing these frederal bureaucracies obtain more power, obtain more control over more parts of our day to day lives. Frankly, I don't understand the appeal some of these members who will talk about how wonderful business investment is, how important it is to have a pro gross tax code. They'll say that on one hand, then on the other hand, you look at the legislation that they're supporting, whether it becomes law in some cases even it doesn't become law. But they consistently also support growing the federal behemoth, deepening the swamp in Washington, d C. They're going against what they claim to be in favor of. But ultimately, one of the saddest realities about Washington is the easiest way to tell whether a piece of legislation is going to become law is if it increases spending and has Republican support.

They build HR forty three sixty six had about four hundred and fifty nine billion dollars in discretionary spending for fiscal year twenty twenty four across twelve federal departments and agencies. That bill includes over six thousand, six hundred projects requested by individual lawmakers. Isn't that almost an explosion of pork.

They build HR forty three sixty six had about four hundred and fifty nine billion dollars in discretionary spending for fiscal year twenty twenty four across twelve federal departments and agencies. That bill includes over six thousand, six hundred projects requested by individual lawmakers. Isn't that almost an explosion of pork.

This is one of the biggest tragedies of the last few years I believe is that Congress had actually taken a step towards being more responsible. They had decided on a bipartisan basis to get rid of these pork barrel projects entirely. And then as soon as Democrats took control in twenty twenty one, the ear marks came back. And unfortunately bringing them back has also had bipartisan support. You even had a majority of Republicans in the House of Representatives, I believe last year voted to keep this in place. And while Republicans tend to be using these line items spending measures to support fairly routine things like highway expansions or work on inland waterways, unfortunately that gives the green light for Democrats to spend on what they're most interested in. And so oftentimes what the Democrats are interested in is promoting far left ideology on things like critical race theory, things like the LGBTQ agenda. And again, it's one thing if a private individual or a private entity wants to promote these ideas. It's a free country. I really resent when they're using public tax dollars, and I resent it even more when they're spending money we don't have.

This is one of the biggest tragedies of the last few years I believe is that Congress had actually taken a step towards being more responsible. They had decided on a bipartisan basis to get rid of these pork barrel projects entirely. And then as soon as Democrats took control in twenty twenty one, the ear marks came back. And unfortunately bringing them back has also had bipartisan support. You even had a majority of Republicans in the House of Representatives, I believe last year voted to keep this in place. And while Republicans tend to be using these line items spending measures to support fairly routine things like highway expansions or work on inland waterways, unfortunately that gives the green light for Democrats to spend on what they're most interested in. And so oftentimes what the Democrats are interested in is promoting far left ideology on things like critical race theory, things like the LGBTQ agenda. And again, it's one thing if a private individual or a private entity wants to promote these ideas. It's a free country. I really resent when they're using public tax dollars, and I resent it even more when they're spending money we don't have.

But what you have here is borrowing money in order to spend the money on propaganda that the government launches you. So in essense, you're paying for your own endoctrination.

But what you have here is borrowing money in order to spend the money on propaganda that the government launches you. So in essense, you're paying for your own endoctrination.

Yeah, that is absolutely the case. So one example, Senator Van Holland of Maryland secured a half million dollar earmark for the NAACP, which once had somewhat of a noble mission back in the nineteen sixty civil rights movement, but which is now almost entirely devoted to promoting racial animosity. This is a group that is extremely partisan how it operates. It's a de facto wing of the Democratic Party. It has no business receiving one cent of taxpayer dollars, and yet they're getting half a million taxpayer dollars.

Yeah, that is absolutely the case. So one example, Senator Van Holland of Maryland secured a half million dollar earmark for the NAACP, which once had somewhat of a noble mission back in the nineteen sixty civil rights movement, but which is now almost entirely devoted to promoting racial animosity. This is a group that is extremely partisan how it operates. It's a de facto wing of the Democratic Party. It has no business receiving one cent of taxpayer dollars, and yet they're getting half a million taxpayer dollars.

The list just sort of goes on and on and on about where money's being spent in Is it largely just sort of I take care of your district, you take care of mine.

The list just sort of goes on and on and on about where money's being spent in Is it largely just sort of I take care of your district, you take care of mine.

When you look at how a lot of middle of the road Republicans who are on board of their marks, I think that's how they're viewing it, because again they aren't quite as deeply ideologically driven. They're looking at it in terms of, oh, my district might need help reservicing a road, and my district will get this money, so in turn, we'll let this Democratic district have some money. Democrats are being much more strategic with how they want to use these taxpayer dollars. They fund what I call the infrastructure of the left, which means all these left wing institutions, both inside and outside of government. I think there are times where everyday Americans might be looking at what's in the news and saying, why are there organizations that are paying people to block highways, Why are their organizations that are promoting transgender ideology in our schools? Why are there all these groups protesting in the streets and support of hamas terrorists. This is all possible because the far left has institutions that fund radical activists, and unfortunately, the moderate Republicans have signed off on getting Democrats slush funds to work with, and then the Democrats use our tax dollars to fund these left wing institutions. It's something that has got to stop.

When you look at how a lot of middle of the road Republicans who are on board of their marks, I think that's how they're viewing it, because again they aren't quite as deeply ideologically driven. They're looking at it in terms of, oh, my district might need help reservicing a road, and my district will get this money, so in turn, we'll let this Democratic district have some money. Democrats are being much more strategic with how they want to use these taxpayer dollars. They fund what I call the infrastructure of the left, which means all these left wing institutions, both inside and outside of government. I think there are times where everyday Americans might be looking at what's in the news and saying, why are there organizations that are paying people to block highways, Why are their organizations that are promoting transgender ideology in our schools? Why are there all these groups protesting in the streets and support of hamas terrorists. This is all possible because the far left has institutions that fund radical activists, and unfortunately, the moderate Republicans have signed off on getting Democrats slush funds to work with, and then the Democrats use our tax dollars to fund these left wing institutions. It's something that has got to stop.

Part of the side effect of this is that the national debt now is up to thirty four and a half trillion dollars, which is really pretty staggering. The federal debt keeps going up, and you go back one hundred years, it was four hundred and three billion dollars in that frankly included part of the World War I costs because it was going down at the time, and now it's jumped all the way up into the thirty four and a half trillion. And it seems to me when you have that big a debt, then you have a huge interest payment on the debt. And if interest rates keep going up. The federal government is the largest debt or in the world, so it's interest payments is going to go up. I mean, doesn't this become a dangerous cycle?

Part of the side effect of this is that the national debt now is up to thirty four and a half trillion dollars, which is really pretty staggering. The federal debt keeps going up, and you go back one hundred years, it was four hundred and three billion dollars in that frankly included part of the World War I costs because it was going down at the time, and now it's jumped all the way up into the thirty four and a half trillion. And it seems to me when you have that big a debt, then you have a huge interest payment on the debt. And if interest rates keep going up. The federal government is the largest debt or in the world, so it's interest payments is going to go up. I mean, doesn't this become a dangerous cycle?

It absolutely does. We're likely going to spend over one trillion dollars on interest on the national debt, which is somewhere around six thousand dollars for every household in the country, just this year, just to maintain the national debt where it is. And it's not as though this is paying down the debt, because the national debt is going to be increasing by around one point five to two trillion dollars every single year moving forward indefinitely, which is completely unsustainable. It's absolutely possible for interest rates to have a sudden spike because the global markets for buying the US debt can only afford to buy so much, and if interest rates go much higher than they are, very quickly, you would see just interest payments on the debt absorbing all of the income tax dollars that the US economy produces every single year, and in that case, we're not going to have money for covering the other core expenses of the federal government, like veterans benefits, like national defense. Also, the higher the interest payments go, the more deficit spending we have, and the more deficit spending we have, the harder it's going to be to ever start catching up on all the economic gains that we've lost to inflation over the last couple of years.

It absolutely does. We're likely going to spend over one trillion dollars on interest on the national debt, which is somewhere around six thousand dollars for every household in the country, just this year, just to maintain the national debt where it is. And it's not as though this is paying down the debt, because the national debt is going to be increasing by around one point five to two trillion dollars every single year moving forward indefinitely, which is completely unsustainable. It's absolutely possible for interest rates to have a sudden spike because the global markets for buying the US debt can only afford to buy so much, and if interest rates go much higher than they are, very quickly, you would see just interest payments on the debt absorbing all of the income tax dollars that the US economy produces every single year, and in that case, we're not going to have money for covering the other core expenses of the federal government, like veterans benefits, like national defense. Also, the higher the interest payments go, the more deficit spending we have, and the more deficit spending we have, the harder it's going to be to ever start catching up on all the economic gains that we've lost to inflation over the last couple of years.

It seems to be one of the great problems is that the Federal Reserve is trying to use interest rates, which primarily affect the private sector. But if you have a government pouring over a trillion dollars a year in unpaid for spending, they're going to inflate the amount of currency that's available at the very time that the Federal Reserve is trying to constrain it. So you end up with a very very heavy bias towards crushing the private sector while expanding the government sector, which is part of why I think forty percent of all new jobs have actually been directly or indirectly tied to the government. But isn't this whole problem of very large deficit spending almost inevitably inflationary.

It seems to be one of the great problems is that the Federal Reserve is trying to use interest rates, which primarily affect the private sector. But if you have a government pouring over a trillion dollars a year in unpaid for spending, they're going to inflate the amount of currency that's available at the very time that the Federal Reserve is trying to constrain it. So you end up with a very very heavy bias towards crushing the private sector while expanding the government sector, which is part of why I think forty percent of all new jobs have actually been directly or indirectly tied to the government. But isn't this whole problem of very large deficit spending almost inevitably inflationary.

It absolutely is, And you're right about the cost to the private sector. The higher borrowing cost mean there's going to be a lot less private investment, which is going to reduce economic growth. It's going to reduce job creation. We're caught in a bind as long as Washington keeps avoiding physcal responsibility. Right now, we've got both high interest rates and elevated inflation. If you try to lower interest rates, that's going to get you higher inflation. If you try to push harder against inflation and raise interest rates even further, you risk crashing the economy altogether. The only way to fix it so that we can start bringing interest rates down. By the way, another big problem with high interest rates is it's now very difficult for young families to afford to buy a home, and that means we're going to have fewer young families, fewer babies, and that only makes everything worse. Down the road. In terms of our budget problems, everything just compounds on itself. The longer we wait to take action on bringing the size and scope of the federal government back to a realistic size, the harder the solutions are going to be.

It absolutely is, And you're right about the cost to the private sector. The higher borrowing cost mean there's going to be a lot less private investment, which is going to reduce economic growth. It's going to reduce job creation. We're caught in a bind as long as Washington keeps avoiding physcal responsibility. Right now, we've got both high interest rates and elevated inflation. If you try to lower interest rates, that's going to get you higher inflation. If you try to push harder against inflation and raise interest rates even further, you risk crashing the economy altogether. The only way to fix it so that we can start bringing interest rates down. By the way, another big problem with high interest rates is it's now very difficult for young families to afford to buy a home, and that means we're going to have fewer young families, fewer babies, and that only makes everything worse. Down the road. In terms of our budget problems, everything just compounds on itself. The longer we wait to take action on bringing the size and scope of the federal government back to a realistic size, the harder the solutions are going to be.

So the longer we go down this road, the more painful it's going to get to be. At the same time, the more difficult any kind of corrective action becomes. Yes, in your mind and from your background as an analyst, did you see anything in the recent bill that begins to move towards less spending.

So the longer we go down this road, the more painful it's going to get to be. At the same time, the more difficult any kind of corrective action becomes. Yes, in your mind and from your background as an analyst, did you see anything in the recent bill that begins to move towards less spending.

There are a small number of specific programs in federal bureaus that either had their spending frozen, which you could view as a reduction when you adjust for inflation, which also a few small areas that were cut. By and large, what this spending bill does is keeps things frozen in place. The problem is that the year before there is a huge spending increase. So if you compare the most recent bill to where things were just two years ago, it's still a very real spending increase overall, And again we're in a place where we can't really afford spending increases anywhere.

There are a small number of specific programs in federal bureaus that either had their spending frozen, which you could view as a reduction when you adjust for inflation, which also a few small areas that were cut. By and large, what this spending bill does is keeps things frozen in place. The problem is that the year before there is a huge spending increase. So if you compare the most recent bill to where things were just two years ago, it's still a very real spending increase overall, And again we're in a place where we can't really afford spending increases anywhere.

At the Heritage Foundation, you've been developing a budget reform program. I mean, what are your recommendations for Congress to address budget reform?

At the Heritage Foundation, you've been developing a budget reform program. I mean, what are your recommendations for Congress to address budget reform?

Yes, thank you for mentioning that the Heritage Foundation has what we call a budget blueprint that would dramatically reduce wasteful spending across the board. We have I believe, about one hundred and eighty different spending reduction options right now. There's so much of the federal apparatus that everyday Americans get absolutely no benefit from whatsoever. So the Heritage budget plan would not only reduce lots of wasteful parts of the federal bureaucracy, would also makes also security and medicare survive rather than go bankrupt. It would also reform the tax code because there's a lot of what's essentially spending is done through the tax code, so enabling us to maintain a pro gross tax code, this plan would really benefit in terms of economic growth while also making sure that the country doesn't go broke.

Yes, thank you for mentioning that the Heritage Foundation has what we call a budget blueprint that would dramatically reduce wasteful spending across the board. We have I believe, about one hundred and eighty different spending reduction options right now. There's so much of the federal apparatus that everyday Americans get absolutely no benefit from whatsoever. So the Heritage budget plan would not only reduce lots of wasteful parts of the federal bureaucracy, would also makes also security and medicare survive rather than go bankrupt. It would also reform the tax code because there's a lot of what's essentially spending is done through the tax code, so enabling us to maintain a pro gross tax code, this plan would really benefit in terms of economic growth while also making sure that the country doesn't go broke.

Which you also have some pretty dramatic reforms, such as repealing the Davis Macon Act, which has been there since the nineteen thirties.

Which you also have some pretty dramatic reforms, such as repealing the Davis Macon Act, which has been there since the nineteen thirties.

Yeah, there are programs that the Heritage Foundation has been going after since it was founded. In the nineteen seventies the Davis Bacon Act, which requires that projects receiving federal fundels have to utilize essentially union mandated wages. There's also something similar on work rules. This is something that I have honestly don't know why Republicans have been willing to sign off on it for so many generations. But what ends up happening is it prevents contractors who aren't unionized from bidding on government projects. You have a smaller number of bidders who are able to then demand higher prices. So then when the federal government is funding a project, that means that project is going to cost a lot more, it's going to tend to take longer to get completed. Another thing that does is that undermines the right to work states, which is now a majority of the country, because there's no right to work when the federal government gets involved.

Yeah, there are programs that the Heritage Foundation has been going after since it was founded. In the nineteen seventies the Davis Bacon Act, which requires that projects receiving federal fundels have to utilize essentially union mandated wages. There's also something similar on work rules. This is something that I have honestly don't know why Republicans have been willing to sign off on it for so many generations. But what ends up happening is it prevents contractors who aren't unionized from bidding on government projects. You have a smaller number of bidders who are able to then demand higher prices. So then when the federal government is funding a project, that means that project is going to cost a lot more, it's going to tend to take longer to get completed. Another thing that does is that undermines the right to work states, which is now a majority of the country, because there's no right to work when the federal government gets involved.

So in a sense, this is a good example where prices are made more expensive, the competitive pool is much smaller. And one of the places I've mentioned to look at is rebuilding the bridge in Baltimore and whether or not all these things apply to make it more expensive and more difficult and make it take.

So in a sense, this is a good example where prices are made more expensive, the competitive pool is much smaller. And one of the places I've mentioned to look at is rebuilding the bridge in Baltimore and whether or not all these things apply to make it more expensive and more difficult and make it take.

Longer very important bridge. And while I generally am someone who doesn't think the federal government should get involved, if the federal government was in a position to make the bridge construction go faster, you make that process happen more smoothly, that's something that might be worth spending a little bit of money on. There's a couple problems there. Of course. Number one, they don't need to pass additional spending. They just passed a huge infrastructure program a couple of years ago. The money is already there, they just need to draw from it. But then, of course, on the other side, you have all the red tape about what business is very able to bid, where the materials are allowed to come from. And then in turn, the Biden administration imposes lots of mandates on infrastructure programs that have nothing to do with any law of Congress past related to things like diversity, equity and inclusion, environmental justice, racial justice, climate change. When you add all that red tape together, we're spending multiple times more than we need to on the projects. They take years longer than they need to. I mean, right now, the expectation is rebuilding this bridge would take ten years, even though the initial construction only took five years. That's absolutely not how we should be doing things in America.

Longer very important bridge. And while I generally am someone who doesn't think the federal government should get involved, if the federal government was in a position to make the bridge construction go faster, you make that process happen more smoothly, that's something that might be worth spending a little bit of money on. There's a couple problems there. Of course. Number one, they don't need to pass additional spending. They just passed a huge infrastructure program a couple of years ago. The money is already there, they just need to draw from it. But then, of course, on the other side, you have all the red tape about what business is very able to bid, where the materials are allowed to come from. And then in turn, the Biden administration imposes lots of mandates on infrastructure programs that have nothing to do with any law of Congress past related to things like diversity, equity and inclusion, environmental justice, racial justice, climate change. When you add all that red tape together, we're spending multiple times more than we need to on the projects. They take years longer than they need to. I mean, right now, the expectation is rebuilding this bridge would take ten years, even though the initial construction only took five years. That's absolutely not how we should be doing things in America.

I just did a newsletter at GAINID three sixty on rebuilding the Baltimore Bridge, and we've had some examples. One in Minneapolis that was remarkably fast, got the job done. The north Ridge earthquake when Governor Wilson was in charge in California got the job done remarkably fast. You can do it, but it requires breaking out of the mindset of federal red tape and federal regulatory overreach. And it will be interesting to see whether or not the Biden people decide that getting Baltimore back to work is more important than filling out the next ten thousand pages of regulations. And I think that's going to be a big discussion over the next few weeks for that very reason, because it involves so many jobs. And the other thing I've been pushing is they should insist that the shipping company and its insurance companies pay for the bridge. This is a ClearCase where you have somebody who's responsible, and while I think we might loan them the money to keep moving while we fight over it, I think this should be a specific goal of trying to get the total costs of the bridge repair done by the people who are responsible for hitting the bridge, which fits perfectly in insurance law.

I just did a newsletter at GAINID three sixty on rebuilding the Baltimore Bridge, and we've had some examples. One in Minneapolis that was remarkably fast, got the job done. The north Ridge earthquake when Governor Wilson was in charge in California got the job done remarkably fast. You can do it, but it requires breaking out of the mindset of federal red tape and federal regulatory overreach. And it will be interesting to see whether or not the Biden people decide that getting Baltimore back to work is more important than filling out the next ten thousand pages of regulations. And I think that's going to be a big discussion over the next few weeks for that very reason, because it involves so many jobs. And the other thing I've been pushing is they should insist that the shipping company and its insurance companies pay for the bridge. This is a ClearCase where you have somebody who's responsible, and while I think we might loan them the money to keep moving while we fight over it, I think this should be a specific goal of trying to get the total costs of the bridge repair done by the people who are responsible for hitting the bridge, which fits perfectly in insurance law.

Absolutely, the federal government wasn't operating the ship, State of Maryland wasn't operating the ship. A private company was operating the ship. They have the primary responsibility. And while it might take a few years for different lawsuits to determine whether it's going to be the shipowner or the people who are responsib for the crew who exactly bears the private side responsibility, we don't have a couple of years to sit around waiting for the legal process to sort out. We do want to get the rebuilding process started, but absolutely, I think it's really important for the federal government to keep its eye on the ball and make sure the taxpayers are paid back by the companies involved.

Absolutely, the federal government wasn't operating the ship, State of Maryland wasn't operating the ship. A private company was operating the ship. They have the primary responsibility. And while it might take a few years for different lawsuits to determine whether it's going to be the shipowner or the people who are responsib for the crew who exactly bears the private side responsibility, we don't have a couple of years to sit around waiting for the legal process to sort out. We do want to get the rebuilding process started, but absolutely, I think it's really important for the federal government to keep its eye on the ball and make sure the taxpayers are paid back by the companies involved.

We could loan the money to an organization set up to build the bridge, with the understanding that that organization would then take whatever legal steps are necessary for the shipping company and the insurance companies to get the money back for the taxpayers, and just that attitude would be a good step towards moving back towards a balance budget, which, as you know I helped author the only four balance budgets in your lifetime, so I know it can be done, but it takes a totally different attitude and frankly, a lot of mental toughness in order to get it done. David, I want to thank you for joining me. I want to encourage our listeners to go to Heritage dot org to read your latest articles analyzing the spending bill the earmarks within it. I think it is so important for us as a country to realize that we will never lower the federal debt unless we curtail spending, and another more triman earmarks would be a great first step. Thank you very much, Thank you to my guest David Ditch. You can read more about the earmarks and the one point two trillion dollar spending bill on our show page at Newtsworld dot com. News World is produced by Ganglish three sixty Antiheartmedia. Our executive producer is Guarnsey Sloan and our researcher is Rachel Peterson. The artwork for the show was created by Steve Fenley. Special thanks to the team at Ganish three sixty. If you've been enjoying Newts World, I hope you'll go to Apple Podcast and both rate us with five stars and give us a review so others can learn what it's all about. Right now, listeners of New World can say for my three free weekly columns at gingriishtree sixty dot com slash newsletter, I'm newt gingriichh. This is Newtsworld

We could loan the money to an organization set up to build the bridge, with the understanding that that organization would then take whatever legal steps are necessary for the shipping company and the insurance companies to get the money back for the taxpayers, and just that attitude would be a good step towards moving back towards a balance budget, which, as you know I helped author the only four balance budgets in your lifetime, so I know it can be done, but it takes a totally different attitude and frankly, a lot of mental toughness in order to get it done. David, I want to thank you for joining me. I want to encourage our listeners to go to Heritage dot org to read your latest articles analyzing the spending bill the earmarks within it. I think it is so important for us as a country to realize that we will never lower the federal debt unless we curtail spending, and another more triman earmarks would be a great first step. Thank you very much, Thank you to my guest David Ditch. You can read more about the earmarks and the one point two trillion dollar spending bill on our show page at Newtsworld dot com. News World is produced by Ganglish three sixty Antiheartmedia. Our executive producer is Guarnsey Sloan and our researcher is Rachel Peterson. The artwork for the show was created by Steve Fenley. Special thanks to the team at Ganish three sixty. If you've been enjoying Newts World, I hope you'll go to Apple Podcast and both rate us with five stars and give us a review so others can learn what it's all about. Right now, listeners of New World can say for my three free weekly columns at gingriishtree sixty dot com slash newsletter, I'm newt gingriichh. This is Newtsworld