Reining In Federal Spending Must Start With The Executive Branch

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If the incoming Trump administration is serious about controlling federal spending — and it should be — there’s an easy place to start: Within the Executive Branch itself.

For years going on decades, presidents of both parties have used executive action to spend money Congress never fully authorized. Under its pay-as-you-go rules, Congress needs to fund increases in spending with offsetting reductions elsewhere in the federal budget. (At least it should reduce spending elsewhere, but the rules frequently get waived, which is its own separate problem.) And because of those strictures, Congress often finds it easier to defer action to the executive, which doesn’t have to pay for new spending when it comes via regulation.

As with omnibus spending bills, it’s another example of lawmakers’ laziness — because lawmakers don’t want to say “no” to anyone by cutting spending — leading to the abdication of Congress’ constitutional responsibilities. And with the federal government more than $36 trillion in debt, it’s bankrupting the next generation of Americans.

Coverage of Obesity Drugs

Just before Thanksgiving, the outgoing Biden administration proposed an expansion of Medicare coverage of anti-obesity drugs such as Wegovy and Zepbound. The Medicare Modernization Act of 2003, which established the Part D program, prohibited plans from covering weight loss drugs. But the Biden proposal would characterize obesity (i.e., a body mass index of over 30) as its own disease, permitting plans to cover the drugs. (Medicare plans already cover these drugs for conditions other than obesity, such as diabetes or heart conditions.)

On the merits, it appears a somewhat arguable case to distinguish obesity as a disease separate and distinct from general weight loss, and therefore allow for coverage within Medicare. Pharmaceutical company Pfizer hired consulting firm Manatt to make that argument in a policy paper released last fall.

But put that argument up against a report released by the Congressional Budget Office in October, which said that expanding Medicare’s coverage of anti-obesity drugs would cost $35 billion over a decade. Add in the fact that the Biden proposal would require state Medicaid programs to cover these anti-obesity medications, imposing an unfunded mandate on the states, and the lame-duck nature of Biden’s administration, and the proposal looks like a cross between an executive power grab and a political stunt designed to put the incoming Trump administration in a bind.

Unauthorized Spending

Unfortunately, this type of spending by presidents has become far too common. It isn’t just the billions in student loan “forgiveness” that Biden shoveled out the door — to say nothing of the hundreds of billions more that he wanted to add to the total, had the Supreme Court not gotten in his way.

Biden has spent money unilaterally in myriad other ways that have gone undetected outside of official Washington. He expanded Obamacare subsidies in two tranches — an extension to certain families, costing $45 billion over ten years, and to Deferred Action for Childhood Arrivals recipients, costing $1.15 billion over five years — that a Democratic Congress could have authorized explicitly in 2021, but didn’t. (Hopefully, the Republican Congress will repeal those expansions permanently, preventing a future Democratic president from reinstating them.) More recently, he shoveled out $5 billion to insurers in a thinly disguised political giveaway prior to the November election.

For his part, Donald Trump won’t come back into the Oval Office with clean hands on this matter, either. In late November 2020, his first administration finalized an ill-advised — not to mention seriously ill-timed — rule that would have raised Medicare spending by roughly $200 billion, not to mention raising premiums for seniors by several dollars per month. Worse yet, by finalizing this rule just before Biden took office, the incoming administration could achieve (phony) “savings” by delaying the implementation of this Trump rule indefinitely — and then turn around and spend those savings on leftist priorities. That’s what Democrats did — not once, but twice.

Stop Overspending

If Trump wants to put the federal government on a diet, then he should start by setting an example in his own administration. He should state that he will not issue any regulatory proposals that spend money without proposing regulations that achieve at least as much in savings. Better yet, don’t issue any regulatory proposals that spend money, period. To borrow an old phrase, that would be a change that conservatives can believe in.