To sum up elections in the words of famed political operative James Carville, “It’s the economy, stupid!” It was the topic of discussion for the candidates running in the 17th Congressional District, who recently sat for half-hour interviews with WGLT.
The Treasury Department has said the U.S. budget deficit was more than $1.8 trillion in the 2024 budget year. Interest on the federal debt was more than a trillion dollars, or about 20% of the roughly $5 trillion in federal revenue. Yet the nation has not had a serious conversation about the budget deficit since the Clinton administration.
It’s probable that will have to change in the next four years to prevent the possibility that federal borrowing costs could begin to drag down the economy.
The two candidates for Congress in the 17th District have different approaches to dealing with the deficit. The 17th District includes parts of Bloomington-Normal and Greater Peoria.
Republican challenger Joe McGraw, a former circuit court judge, said a good start in balancing the budget is to actually pass a spending plan and not rely on continuing resolutions.
“I think it will make them much more accountable to the folks in the district when they have to explain why they did or didn’t vote for something. I think that alone will cause them to be more circumspect. Less things will be just grouped together and run through without serious consideration,” said McGraw.
McGraw also said every year’s budgeting exercise should start at zero. He said that would also force Congress and federal agencies to consider how they spend money and not just talk about last year and how much more they need this year.
McGraw said he also wants to eliminate waste in government.
So does incumbent Democratic Rep. Eric Sorensen.
“One of the things I am proud of is to be able to sponsor the Identifying and Eliminating Wasteful Programs Act. This helps find where wasteful things are in Congress,” said Sorensen.
That would help. But the Congressional Budget Office and a variety of nonpartisan think tanks estimate that cutting waste and fraud alone would not move the deficit needle much.
McGraw’s other big idea for deficit reduction is an orthodox GOP proposal.
“The best way to increase revenue is to lower taxes,” he said.
The theory goes that lower taxes stimulate business and personal income growth and overall economic growth. But the Center on Budget and Policy Priorities said in states that have tried this approach, government revenues have gone up less than the taxes cut, which would actually increase the federal deficit. Indeed, the Trump administration tax cuts increased the deficit.
Building wealth
Sorensen embraced the orthodox Democratic policy plank about allowing the Trump tax cuts to expire and asking the wealthy to pay their fair share.
He said one way to grow the economy is to build infrastructure to make sure U.S. products have competitive access to world markets.
“You know that we have to make sure we are building things in this country and that is going to build wealth. We have to understand that, yeah, the deficit is going up, but so is the value of our country. Our GDP needs to go up,” said Sorensen.
One example from Sorensen comes from the Illinois and Mississippi rivers.
“Lock and Dam 15 is 600 feet long. It doesn’t work anymore. It was designed in the 1930s. I’m leading the effort so that we can build 1,200-foot locks so that we can get our goods and commodities down the Mississippi River to the Gulf and out to export as fast as we can,” said Sorensen.
There are 29 locks on the Mississippi and eight on the Illinois River. Rivers transport 60% of the nation’s commodities. River infrastructure spending has over the decades happened episodically. Sorensen said he wants funding for updates put in the omnibus budget, just as road and airport funding is in annual spending bills.
“What I want to see is a yearly $50 million — not with a B, not with a T — million. So, it allows hardworking people, these are good labor jobs, to rebuild our locks,” said Sorensen.
To put that $50 million in scale, a couple years ago, before Sorensen was elected, the Corps of Engineers allocated $829 million for the Navigation and Ecosystem Sustainability Program to improve just a few locks and do some environmental projects on the Mississippi. As deficit reduction through economic growth, Sorensen’s proposal is, relatively speaking, small ball.
Renewable energy
Sorensen said he also wants to support electric vehicle making in Belvidere and Normal to catch up to huge EV production in China. That’s a new and growing sector of the economy.
Meanwhile, in answer to a question about federal incentives to grow the wind and solar part of the economy, McGraw said, “We need to get out of the way of anything that impedes the production of fossil fuel.”
McGraw said he wants to reduce the size of government and for government to do less in every agency.
“So, let’s take a look at what their focus was, what their charter was and see if they have gone beyond that unnecessarily and do we have unnecessary people there. The easiest example I can think of is the 80,000 new IRS agents,” said McGraw.
Except those agents aren’t exactly new and they’re not all agents. A 2021 Treasury Department report said the funding for those IRS employees would mostly be replacements over a decade of people retiring. They include customer service and technology specialists.
More than half the federal budget goes to Social Security, Medicare, and unemployment compensation. Sorensen does not think those are good ways to address the deficit.
“We need to make sure we have funding for and protecting Social Security and Medicare so those are never on the chopping block because there are people on the other side that want to be able to take from that or raise the retirement age. And so, some of these are non-starters,” said Sorensen.
In the interviews, neither candidate in the 17th District took major policy swings at deficit reduction. They do have very different philosophical approaches to growing the economy.
Meanwhile, the fiscal think tank Committee for a Responsible Federal Budget estimates the proposals of both major party presidential candidates would increase the deficit. The ideas of former President Donald Trump would create two times more red ink than Vice President Kamala Harris.