Romney vs. Leviathan: Who Will Win?

Pierre Lemieux is a professor at the University of Quebec in Ottawa and author of “Une crise peut en cacher une autre” [“One crisis may mask another”], (Les Belles Lettres, 2010).

Many observers believe that the American presidential campaign, in which Barack Obama will likely run against Mitt Romney, will center on the subject of government size. The Economist magazine (which supported Obama in 2008) echoed this last week. The Republican candidate, urged by the Tea Party, will suggest reducing the size of government, whereas the Democratic president, supported by trade unions and leftist intellectuals, will defend the status quo; in other words, fattening government even more.

It isn’t clear whether this debate will define the electoral campaign. One reason is the possibility that the candidates will converge toward the middle, a complex matter I will come back to in future columns. But if this does become the theme of the campaign, Mr. Romney will find himself on dangerous ground, as he does not have much up his sleeve to attack the size of federal government, which has now reached 24 percent of the U.S. GDP (with state and local administrations adding another 11 percent). He promises to bring federal expenses down to 20 percent of the GDP, slightly above the average 19 percent of the past forty years. But he does not know how, and with good reason.

The worn out plan to shrink government by “reduc[ing] waste and fraud,” that Mr. Romney picked up, will go nowhere. This objective is part of well known political sawmills: Ronald Reagan already raised this issue without much success during the ’80s; Barack Obama’s last budget included the same terms. However, one could estimate that raising productivity of federal employees by 25 percent would allow at most a reduction of 2 to 5 percent of federal government spending, barely a drop of water in a sea of deficit equal to 30 percent of federal spending.

During both his terms, Ronald Reagan made federal expenses drop from 22 to 21 percent of the GDP — mostly because economic growth made the denominator go up. The harsh reality, which Ronald Reagan came up against and which will haunt Mitt Romney’s White House, is that is it impossible to reduce the U.S. federal government without a radical rethinking of the missions it undertakes.

The numbers speak for themselves. Mr. Romney basically promises not to touch public pensions (Social Security), or health insurance for older Americans (Medicare), or national defense. These three spending categories respectively make up 23 percent, 15 percent and 24 percent of federal spending programs (expenses other than interest). Their total exceeds 60 percent of expenses. It is therefore only on 40 percent of the budget that Mr. Romney can plan cuts. This is a bad start.

The Republican candidate promises that yearly federal spending will be reduced by 13 percent by the end of his first term. Since this 13 percent only aims at 40 percent of spending, it means that he needs to reduce by a third those non-untouchable expenses, which include public healthcare for the poor (Medicaid), income security and education — especially grants of this type to the states and local administrations. It’s going to end badly.

It’s understandable that Mr. Romney is stingy with the details on the nature of the cuts. The very broad examples he gives on his website barely add up to $300 billion in savings, which is less than two thirds of the goal he has in mind.

Once again: reducing federal government spending in a significant manner would require radically challenging government interventionism and the power of the state. Now, it is doubtful that Mr. Romney, who lacks a well-defined philosophy, would want to take on such a challenge. Like other conservatives, he does not hate government power, as long as it serves his own values. And even if he genuinely wanted to reduce the size of the government, it is even more doubtful he would be able to do so. He would fail, just as Ronald Reagan did before him.

In the U.S., just as elsewhere in the world, government seems out of control. It carries the name Leviathan very well, just as Thomas Hobbes called it with admiration in his book in 1651.