From last year's GOP primary debate in New Hampshire, moderated by John King:
KING: What else, Governor Romney? You've been a chief executive of a state. I was just in Joplin, Missouri. I've been in Mississippi and Louisiana and Tennessee and other communities dealing with whether it's the tornadoes, the flooding, and worse. FEMA is about to run out of money, and there are some people who say do it on a case-by-case basis and some people who say, you know, maybe we're learning a lesson here that the states should take on more of this role. How do you deal with something like that?
ROMNEY: Absolutely. Every time you have an occasion to take something from the federal government and send it back to the states, that's the right direction. And if you can go even further and send it back to the private sector, that's even better.
Instead of thinking in the federal budget, what we should cut -- we should ask ourselves the opposite question. What should we keep? We should take all of what we're doing at the federal level and say, what are the things we're doing that we don't have to do? And those things we've got to stop doing, because we're borrowing $1.6 trillion more this year than we're taking in. We cannot...
KING: Including disaster relief, though?
ROMNEY: We cannot -- we cannot afford to do those things without jeopardizing the future for our kids. It is simply immoral, in my view, for us to continue to rack up larger and larger debts and pass them on to our kids, knowing full well that we'll all be dead and gone before it's paid off. It makes no sense at all.
Now here's the tl;dr version of Romney's policy:
The federal deficit is too high.
Disaster relief should be handled at the state level.
Moving disaster relief to the state level would reduce the federal deficit while maintaining services.
What he wants you to hear is "you get to keep everything but we don't have to pay for it." However, anyone rubbing two braincells together can figure out the flaw in his reasoning. If the states have to take up the disaster relief mantle, won't they have to pay for it?
The federal deficit will go down. State deficits will go up. But, a president doesn't get blamed for state deficits, so as far as he's concerned he does get to keep the services without paying for it. You still have to pay for it though, because both the state and federal governments are paid out of your pocket.
His policy would make sense if we were in some kind of pre-1790 America where some states were flush with cash and refusing to help out with the national debt. But we don't have rich states now. They're all struggling, and 44 states had budget shortfalls last year.
His policy would also make sense if by passing the buck to the states Romney would actually pass the bucks to the states; the money still comes from the federal government, but is given to the states. And (very important premise) the states will spend that money more effectively and with less waste. The federal government doesn't have a great reputation for efficiency, and state governments are more popular. And if the plan saves a few bucks by cutting waste, why not? Sounds like a great plank in a campaign platform.
Except that disaster relief doesn't work on a state level. For a state that gets hit year after year, like Florida, maybe it would make sense to just cut them a check for their share and tell them to spend it in whatever way works best. But what about everyone else? We predict that there will be a major Mid-Atlantic storm this hurricane season and spread some money around Virginia, DC, Maryland, Delaware, Pennsylvania, and New Jersey, and New York gets a tiny cut because it's still in the possible path, but hey, when was the last time New York was hit by a hurricane, right?
Think Virginia and Maryland are going to hand over the money they didn't end up needing to fund relief work in Manhattan? Not a chance. Once you pass money to states it's gone. You could do that with something like education, where you don't expect one or two states to suddenly get 90% of the nation's school kids. But natural disasters? The typical scenario is one or two states need all the relief funds and the rest need little or none.
This all boils down to a completely ridiculous policy on disaster relief: Pass responsibility to state governments, which will greatly increase inefficiency and decrease service quality, and then lie to you about what it will cost by pretending that state budget money comes from somewhere other than the same wallet that cuts the federal government its tax checks.