Last week many political blogs (including this one) reported that House Majority Leader Eric Cantor (R-VA) intended to demand spending cuts in exchange for any federal aid after Hurricane Irene. Cantor’s office was quick to dispute those reports, saying any aid would be given out as needed. However today on Fox News Cantor confirmed the original reports, stating that any aid for Hurricane Irene would need to be offset by spending cuts somewhere in the budget.
Cantor was criticized earlier for demanding similar spending cuts in exchange for any aid for Joplin, Missouri after a massive ripped through the town. Traditionally Congress has passed aid for natural disasters without offsetting spending cuts. Cantor himself voted for a number of aid packages without offsetting spending cuts during the Bush administration. Putting aid packages through the budgetary process can delay funds weeks or even months when the affected population most needs help. In addition, aid for natural disasters represents a tiny fraction of the federal budget, making its impact on the deficit minimal.
Despite the criticism, Cantor never backed down from his demand, and he now sees another opportunity for spending cuts following Hurricane Irene. Conservative estimates put the property damage from Irene at $3 billion. Flooding was particularly severe in some areas of New Jersey and Vermont. Many property owners were uninsured, and even those that did cover flood insurance may not receive payment due to “act of God” policy exclusions.
Cantor compares the situation to that of a family who deals with a sick loved one and foregoes buying a new car to pay for the medical bills. However, there are a number of potential flaws in that analogy. If America were a person it would not, in fact, be in debt. America has many trillions more in assets than it has in liabilities, and America’s GDP is being taxes at the lowest rate in over 50 years.
In addition, as Jon Stewart pointed out in regard to the Joplin aid controversy, Republicans would like to pay for such aid by making cuts to Social Security and Medicare. Under Cantor’s analogy, this would be the equivalent of paying for a younger family member’s injury by taking away “grandma’s health care.” Democrats would like to pay for aid by increasing taxes on the rich by a few percentage points (the rich brother-in-law in Cantor’s analogy), but Republicans have flatly rejected any tax increases on the rich. Finally, the Republicans actually increased defense spending in the last federal budget, which is the equivalent of putting a laser on dad’s new car while the family’s house is in shambles from a natural disaster.