The import of budget figures, particularly those large values contained within the federal budget, has become something to which we are numb, or worse, indifferent.
A $1.5 trillion request for the U.S. Department of Defense, when all government expenditures total just over $7.5 trillion, is a large number and gets the attention of Congress. But the public is systematically desensitized to expenditures in the billions, and millions barely get noticed.
This is not new; it just seems worse. “A billion here, a billion there, and pretty soon you’re talking real money” is a wry observation widely attributed to the late U.S. Sen. Everett Dirksen in the 1960s.
But expenditures in the millions and billions are important, and they reflect important choices, even if those choices are not obvious. Joe Biden, quoting his father, said: “Don’t tell me what you value. Show me your budget — and I’ll tell you what you value.”
An interesting thought experiment is to imagine what alternative investments could be made in place of some currently controversial choices, since budgets are not unlimited.
Spending $100 million for a Triumphal Arch, or $400 million for a White House ballroom, and $1.776 billion for an anti-weaponization fund are choices. Dollars spent on such expenditures are dollars not available for other investments; what economists call “opportunity costs.”
An arch may enhance the architecture of Washington, D.C. A ballroom might be desired to entertain dignitaries. And a weaponization fund, assuming Donald Trump does not permanently drop this proposal, and it is not ultimately deemed illegal, may serve certain matters of justice. But these expenditures should not be thought of in absolutes.
They need to be weighed against other choices that could be made. What other investments cannot be made with these dollars if they are used for these three expenditures?
At a time when the nation’s families are facing a housing crisis, and when low-income families are pressed by rising prices for the most basic necessities of life, we find it useful to consider how proposed expenditures for one initiative, if reprioritized, could positively impact our housing condition and efforts to lift people out of poverty.
Think about these three large expenditures: the Triumphal Arch, the White House ballroom, and the anti-weaponization fund. What could the funds for these three items alternatively do to enhance housing affordability or reduce poverty?
According to official federal reports of a measure called the aggregate income deficit, $1.776 billion distributed to each poor family in Alabama would bring their incomes above the poverty line. Alternatively, $1.776 billion could raise all Mississippians out of poverty, leaving almost $400 million.
The average cost for a Housing Choice Voucher, a U.S. Department of Housing and Urban Development program that pays the difference between what a family could afford on rent, spending no more than 30% of their income, and the unit’s fair market rent, is approximately $1,200 per certificate per month.
In other words, the federal government pays landlords $14,400 per year on behalf of each supported renter household.
That $1.776 billion could pay rent to landlords for an additional 25,000 families each year for five years. Those families would not have to decide between clothes for their children, medication, food, transportation, or housing for five years into the future.
The $100 million cost of the arch could instead provide 10,000 Philadelphia families with $10,000 first-time homebuyer grants.
What about $400 million for a White House ballroom? Those dollars could support almost 28,000 additional renters this year.
Alternatively, that $400 million deployed in the state of Alaska could bring every low-income Alaskan out of poverty for three years, North Dakota for 11 years, or Delaware for nearly two years.
In Philadelphia, there is a $10,000 grant for first-time homebuyers. Recipients will be able to live in a home they own, providing shelter and stability for their families and an opportunity to accumulate wealth for themselves and future generations. That $400 million could help 40,000 Philadelphia families become first-time homeowners. In place of the arch, $100 million would support 10,000 more families.
Given that budgets are finite, a decision to spend money on one thing represents a choice about what you value, and importantly, those items on which you cannot invest. Sen. Dirksen would probably be shocked at some of the decisions currently being made by some of our elected officials. All of us should be.
Ira Goldstein is senior adviser of policy solutions at Reinvestment Fund, a member of the National Housing Crisis Task Force, and a lecturer at the University of Pennsylvania in the urban studies program. Gregory D. Squires is a research professor and professor emeritus of sociology at George Washington University and a member of the advisory committee to the Philadelphia Home Appraisal Equity Program.