Monday, February 7, 2011

“We Gotta Get the Deficit Down”

Try as I may, I could not find a video of former Senator Jim Sasser repeating, with his wonderful accent, “We gotta get the deficit down.”

The new Republican House intends to reduce the deficit.  Budget Chairman Paul Ryan released his draft budget that cuts $58 billion from President Obama’s spending baseline.  This sum is prorated for the rest of the current fiscal year, which falls short of the $100 billion pledge.  The cut would be followed by another $45 billion in the 2011-12 budget.

Some Republicans want Ryan to go further in the balance of the 2010-11 fiscal year and cut $100 billion by September 30, 2011.

Democrats warn that $100 billion in lower government spending could endanger the recovery.  Meaningful deficit reduction, they argue, should wait until the economy has fully recovered and the unemployment rate has come much further down.

Contrast the hullabaloo of $100 billion in cuts with the January federal deficit of $106 billion.  This year's deficit is projected to exceed $1 trillion.  Cuts of $100 billion represent some 8% of this year’s deficit and about 4% of total federal spending.

If it will be so difficult to cut $100 billion or even $58 billion in the balance of the current fiscal year, imagine how difficult it will be to make any significant cuts until after the November 2012 elections?  And beyond that? Good luck to Congressman Ryan, but don’t hold your breath.

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