Pay For? Yes. Pay Down? Not So Much.
The spectrum incentive auctions were being billed by some Democrats as providing billions of dollars “to pay down the deficit.”
But according to a summary of the payroll tax package, the $30 billion cost of extending unemployment benefits through the end of this year is being paid for by the spectrum auctions — estimated to clear $15 billion after paying for a first responder network and compensating broadcasters — as well as increased contributions by civilian federal workers, including congress folk, to their defined benefit programs.
It is not clear what the split between broadcasters and pensioners is, but nothing immediately suggests that billions will be withheld from the broadcaster take for deficit reduction.
So, if as I suspect all or most of that $15 billion is going to pay unemployment benefits, which is fine with me, it might be better to say that the money will be federal revenues.
Of course, you could argue that spending this $15 billion on unemployment benefits will leave $15 billion somewhere else to reduce the deficit, or perhaps that the spectrum auctions will result in an economic boon via new licensed and unlicensed wireless uses that will redound to the Treasury in taxes revenues.
Whatever the reason for suggesting the money would reduce the deficit, I think Rep. Henry Waxman (D-Calif.) put it better when he said the auctions would “contribute $15 billion to pay for this [payroll/benefits package] legislation.”