With hindsight, we know that certain characteristics of the entitlement programs themselves and political momentum made the growth nearly inevitable. It is worth reviewing how this happened. If we don't heed the lessons of history from the last century we may find that, in the next century, what little remains of the federal budget will be eaten up by another federal program -- emergency management and response.
In 1937, when the Social Security program was passed, no one thought that it would turn out to be the enormous expenditure that it has become. In that year, there were 53,236 beneficiaries, and their benefits cost the federal government just over a million dollars. But, a few things have happened between then and now. People started living longer, so the government had to pay out old-age insurance over many more years. Social Security, intended originally as a supplement to the savings of the elderly, became, in many cases, their sole source of support. And, not surprisingly, the program became so popular and seniors so politically powerful that in the years between 1950 and the present there were 41 increases in the benefit. The original law capped benefits at $494 per year (about $6,000 in 2001 terms). Nowadays, the average monthly payment to a beneficiary is about $1000 a month. In 1941, Social Security outlays were less than 1 percent of the federal budget; today the old-age program alone accounts for 22 percent, and all entitlements combined for 55 percent. The universal nature of the program and the pure political fact that Congress can't say no to old people has created a program that overwhelms all other spending.
Now, look what has happened to expenditures for emergencies. Like Social Security, spending on emergency relief is directed towards people who are in extreme need and who command the sympathy and support of the rest of Americans and their political leaders. Just as all Americans realize that they, too, will be old some day, every American realizes that he or she could wind up in the middle of some natural or man-made disaster. So, there is a political imperative to spend whatever is needed in the wake of disasters.
But unlike entitlement spending, which can be predicted with a fair degree of accuracy using demographic data, emergency spending is viewed as unpredictable. This is why we've gotten into the habit of appropriating emergency response money in what are called "supplemental appropriations." These are spending bills that come up outside the regular budget process. Most supplemental appropriations fall into two categories: defense supplementals, needed to fund the costs of military actions, and non-defense supplementals, almost all of which go to the cost of emergency response. (Some of the non-defense supplementals go to agriculture, but is the amount is small compared to the emergency response dollars.)
The amount of money spent on non-defense supplementals has been rising. In the decade of the 1990s, non-defense supplemental spending came to $22 billion and covered a variety of natural disasters, such as Hurricanes Hugo, Andrew, and Iniki; the Loma Prieta and Northridge earthquakes; and the Chicago floods. In addition, emergency response money covered two man-made emergencies -- the Oklahoma City bombing and the Los Angeles riots.
Emergency spending in the 1990s was greater than it was in the 1980s. However, it pales in comparison to what it has been in the first half of the first decade of the twenty-first century. Driven mostly by one man-made disaster -- 9/11 -- and one natural disaster -- Hurricane Katrina -- supplemental authority for non-defense spending from 2000 to 2005 is already $167,386,000,000, or over seven times as high as it was for the previous decade.
At this rate of growth, emergency preparedness spending could devour what remains of the discretionary budget. Repeated attempts by conscientious members of Congress to actually put aside money for disasters have failed time and time again. And the political will to place limits on aid to victims of disasters or to mitigate further disasters simply doesn't exist. Just recently, FEMA issued its rebuilding guidelines. Structures only need to be rebuilt three feet above ground. I personally worked on a house that had had six feet of water in it although it was three feet above ground. The leniency of these new regulations were hailed by all those anxious to get back home -- no one in the political system really had the heart to tell them they shouldn't go back.
It is tempting, of course, to look at the first five years of this decade as an aberration. 9/11 was an extraordinary event, and so was Hurricane Katrina -- right? Wrong. The well-documented and unprecedented warming of the oceans -- global warming -- may not result in the spectacular ice ages that fill up our movie screens, but it will result in more extreme weather. Even those who refuse to see global warming as a permanent problem will have to admit that we are in a cycle in which, because of warmer temperatures, we will have weather that is more violent.
Second, we have entered an era, in which terrorism is practiced not for specific, identifiable political objectives but for religious objectives that lead to strategies of maximum violence. We can beef up our borders, improve our screening of travelers, and try to destroy terrorist cells, but as long as this brand of violence exists it will, at some point, break through our best defenses.
Looking forward, it is easy to see emergency response spending topping $200 billion in this decade and steadily increasing -- eating what is left of the federal budget
