What the Hell Is NDD?

Nothing better demonstrates the disconnect between the daily lives of ordinary people in this country and the policy debates now taking place in Washington than the term "NDD." While all but a tiny fraction of the population would look with a blank stare at anyone who used the term, it is at the core of what most of the fighting in Washington these days is all about. It describes the portion of the budget that is targeted for dramatic cuts if the current leadership in Congress prevails in pushing its budget plans through Congress in the coming weeks. While few have heard of the term or have any inkling as to its meaning, the efforts underway to slice big chunks from it will affect the lives of virtually every individual in the country in dozens and perhaps hundreds of different ways.
"NDD" stands for "non-defense discretionary" spending, and it is such a huge grab bag of unrelated programs that it is almost impossible to explain and therefore very difficult to defend. Perhaps that is the reason that conservative budget cutters have chosen it as one of their principle foils over the years. But just because you can't explain NDD in a 30-second conversation doesn't mean that it is not important or that deep cuts in it would not have a profound impact on your day-to-day life. But what is it?
Washington splits the federal budget into three basic baskets. The first is the so-called "mandatory programs," which are largely directed toward retirees. The so-called discretionary side of the budget is generally divided into two baskets, defense and non-defense. Mandatory programs include the checks that are sent to people but not the administrative costs of knowing whom to send them to or how much the check should be made out for. In other words, so-called discretionary programs represent pretty much everything we think of as government, while mandatory programs represent payments to people.
Surprisingly to many people, the checks that the government sends to beneficiaries or the healthcare providers that take care of them adds up to a lot more than the cost of actually running the government itself. Everything from defending our global interests to running our courts, protecting our borders to maintaining our parks, funding our schools to investing in science and infrastructure, takes up a little less than one third of our budget. The federal government will spend $3.7 trillion this year, but less than $1.2 will be what we generally label (or, more correctly, mislabel) as "discretionary." Defense will consume about half of that, leaving the other half (16 percent, or one sixth of the total) to pay for non-defense activities, including 14 of the 15 departments of the federal government, as well as the cost of running the legislature and the judiciary.
If we adjust for inflation and population growth, we are spending less on discretionary programs today than we were a quarter of a century ago. Total federal spending has increased by 30 percent in real per capita terms over that period, but all of that increase and a little bit more has been the result of the checks Washington sends back to the American people -- nearly all of them people who are either retired or disabled. But those simple facts have not stopped Washington's so-called "deficit hawks" from making discretionary spending, particularly non-defense discretionary spending, the centerpiece of their war against spending.
That is tragic for the country because starving this complex hodgepodge of programs is not simply unwise but economically stupid and dangerous.
Simply put, you have a lot more at stake in the NDD budget than you probably realize.
About $1 in every $8 in that portion of the budget goes to law enforcement and security efforts ranging from the FBI to prisons, border protection and the Coast Guard. If there were ever a time that we could ignore the outside world and fund those activities based on a simplistic formula rather than our best judgment about the threats we face, now is not that time.
The core activities of the government, such as the operation of courts, collecting revenues, managing public lands and making sure that entitlement payments don't go to the wrong people, make up another one eighth.
Various efforts to protect the nation's health account for about one tenth of the total. These include tracking the spread of infectious diseases around the world, developing vaccines and other countermeasures to prevent their reaching the United States or spreading once they are here, and understanding and developing better treatments for diseases ranging from cancer to diabetes and Alzheimer's. These discretionary health expenditures also fund all our efforts to prevent the distribution and sale of dangerous or tainted foods and medications, and to expedite the approval of new medications that will be more effective in fighting disease.
The single biggest, also fastest-growing, part of the discretionary budget goes to help our veterans deal with their health issues and cope with the world they return to following their military service. That now consumes more than 14 percent of discretionary spending.
Beyond the approximately 50 percent of discretionary spending I just mentioned is another 10 percent that goes to supporting local school districts and other initiatives to help insure that all Americans have access to a quality undergraduate education. Another 5 percent helps disadvantaged students attend college.
An additional 6 percent goes to research efforts outside health fields, such as space exploration; improved weather forecasting; understanding the subatomic particles that make up our universe; finding better, cheaper and cleaner forms of energy; and protecting our information and communications systems from potential catastrophic failure.
And while that lays out the biggest pieces of NDD spending, it still leaves out a lot of critical functions, such as railroad safety or clean water initiatives, or the more than $10 billion a year we spend to operate our air traffic control system -- the foundation of much of the nation's commerce.
The most controversial portions of the NDD budget account for a remarkably small portion of the total. Foreign aid, which some polls indicate Americans believe may account for close to half of all government spending, actually accounts for less than 4 of just the NDD portion of the budget. Aid to the poor, such as housing assistance and discretionary nutrition and unemployment benefits, accounts for only 5 percent of NDD.
When you look across the panoply of federal activities and services, there are a lot of possible spending cuts that could very quickly make your life very uncomfortable. There are many others that might not be noticed immediately but will almost certainly lead to a long-term decline in the nation's economic growth and quality of life if they were to continue over a period of years.
The degradation of federal services caused by a lack of resources can sometimes remain invisible for years. In some instances this degradation is apparent to only a small number of people until suddenly those weakened services create problems affecting large portions of the population.
One recent example of that is passport and customs control at our major airports. Since Republicans took over the House of Representative in 2011, Congress and the White House have been arguing over how to adequately fund the staff necessary to process travelers and commercial shipments through U.S. ports of entry.
As commercial air passenger arrivals into the United States increased by 8 percent between 2011 and 2013, the number of Customs and Border Patrol agents assigned to ports of entry declined by more than 4 percent. The result was predictable. The time that weary travelers were required to spend standing in line before finding their connecting flights or returning to their homes exploded. By August 2013 travelers at JFK in New York found lines exceeding 2 hours on 20 of 31 days. Similar problems occurred at other airports.
This was not only severely aggravating to a great many well-heeled travelers returning from their European vacations. Research performed for the Department of Homeland Security indicated that this understaffing was creating a serious drag on the economy -- costing far more than the price of adequately staffing the passport and customs control points.
By the time Congress met in January of last year, they had heard enough from aggrieved travelers, airport authorities, airlines and other industry groups like the U.S. Travel Association. The 2014 omnibus appropriation increased funding for CBP officers at points of entry by $170 million and called on the agency to recruit 2,000 new officers -- fewer than the 3,700 called for by the U.S. Travel Association but a sharp reversal from the cutbacks forced in previous appropriations.
The good news is that that particular problem was solved, but the bad news is that all of the other problems got worse.
Every time Congress finds a program that it can't afford to cut, it is forced under the so-called "sequestration" legislation passed four years ago to make the problems even worse in the remaining programs.
This year's sequestration cap for NDD is $492 billion. After certain technical adjustments prescribed in the law, this ceiling cuts spending for NDD to about 80 percent of the real per capita spending that was available a decade ago during the Bush administration. If you measure NDD spending as a share of GDP, the cuts have been even deeper.
When spending for passport and customs officers or any other area in the NDD budget goes up, other programs must absorb an equivalent cut, and Customs and Border Patrol staffing at points of entry is relatively minor compared with other increases within NDD that Congress has been forced to accept.
Discretionary spending for veterans is the most dramatic example. The Department of Veterans Affairs' share of NDD was $36 billion in 2006. This year the president has requested more than $70 billion, and Congress is expected to match if not exceed that amount. After adjusting for inflation and population growth, that is a 40-percent increase in the largest program in NDD during a time when overall spending for NDD declined 20 percent.
The implications of such increases for the other programs in NDD become clearer if we view them in the context of the budget resolutions currently before Congress. The resolution before the House, for instance, not only would extend the period in which funding for these programs is not adjusted to reflect inflation or the increased demand for services (such as increasing numbers of travels passing through immigration, higher crime rates or increasing numbers of flights requiring air traffic control) for the next year but would slash funds for those programs even more deeply in future years.
Under the resolution, real per capita spending for NDD would decline by another 27 percent over the next 10 years. But because 14 percent of the total is likely to continue to increase during that period, and because Congress is unlikely to apply such deep cuts to areas such as law enforcement and security or air traffic control, the cuts required of the remaining NDD programs such as research, education and public health will be enormous, perhaps approaching 50 percent.
To combat the pending demise of such investments, a new national organization has evolved over the past several years. That group calls itself NDD United, and it recently sent a letter to members of Congress opposing the further decimation of NDD. That letter was signed by no fewer than 2,100 different organizations from across the country -- requiring about 50 pages, single-spaced, to list.
Some of these organizations are admittedly small, but many are huge, and a lot of Americans will find that they are already a member of a number of organizations that have already begun to lobby Congress to stop this senseless attack on discretionary programs. Included on the list are nearly all the organizations involved with our schools, from the National Parent Teacher Association to school boards, school administrators and teachers.
A large number of organizations are advocates for reversing the decline in federal investments to fight dreaded diseases. These include the American Heart Association, the March of Dimes, the American Cancer Society Cancer Action Network, the Alzheimer's Foundation, the American Lung Association, the American Diabetes Association, the National Multiple Sclerosis Society, the Arthritis Foundation and many more.
Organizations supporting other areas of research include groups such as the American Association for the Advancement of Science, the Association of American Universities, the Association of Public and Land-grant Universities, Research!America, The Science Coalition, the Society for Industrial and Applied Mathematics and the Association of Research Libraries.
There is also strong participation from groups seeking to protect our forests, parks, rivers and wetlands. These include the League of Conservation Voters, the Wilderness Society, the World Wildlife Fund, the Ocean Conservancy, the National Parks Conservation Association, the National Ground Water Association and the Conservation Fund.
A number of signators are organizations that advocate for the poor, and while a surprisingly small percentage of NDD goes to programs that are directed toward low-income individuals (less than 10 percent, by my calculation), the money is critical to many of the services that the dispossessed in our society depend on. These organizations include Habitat for Humanity, the Salvation Army, Sisters of Mercy Extended Justice Team, Bread for the World, B'nai B'rith, the Evangelical Lutheran Church in America and Goodwill Industries.
There are, of course, a number of major organizations that have yet to come to the table. The Pharmaceutical Manufacturers explain on their website that they were a founding member of the Alliance for a Stronger FDA, which decries the lack of money that Congress has provided that agency in recent years. Yet Pharma still seems to have not connected the dots and realized that without more reasonable spending caps, problems like the resource shortage at the FDA are not going to get better.
But the good news is that a great many very large and influential organizations have finally connected the dots. They are essentially telling Congress, "Don't tell me you are for my program and then vote for a spending cap that will ultimately mean my program gets cut. If you vote for such a budget resolution, you are voting against the things our organization is fighting for."
That is a big change, and one has to think that it is likely to grow both in terms of the awareness of the problem within the organizations that have already signed up and the number of organizations that begin to realize that they can only achieve their goals if Congress stops trying to balance the budget on the backs of critically needed programs that represent only 16 percent of total spending. Their efforts not only could mean a great deal in terms of strengthening efforts against dreaded diseases, improving our schools and protecting our natural resources but could force Washington to stop this shell game and examine the real issues in the federal budget.

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