published Friday, August 5th, 2011

$1.5 trillion cut challenge

All of us know how easy it is to spend -- if we have the money. But we also know how painful it is to cut spending when we don't have money.

For a long time -- despite high taxes -- our federal government has been spending far too much, a lot of it for essentials, but a lot of it for nonessentials, too. Now the chickens have come home to roost in the form of a $14.3 trillion national debt. We pay taxes to cover some of our spending. But we have to borrow money to fund the rest -- and that means hundreds of billions of dollars in interest payments every year.

So as you may be aware, Congress plans to appoint a 12-member panel -- six Democrats and six Republicans, divided between representatives and senators -- to make some financial choices that the full Congress has been unable to make.

The panel has the important but unenviable job of reducing federal deficits by $1.5 trillion or so over the next 10 years.

One immediate reaction many of us as taxpayers might have is, "I wish I were on that committee, because I would love to be able to tell Congress where to cut $1.5 trillion!"

But if you were a representative or senator on the 12-member panel -- and were accountable to the public -- you would find that cutting much spending would produce an outcry from many voters, and from a lot of special interests. Lawmakers' unwillingness to face that music over a long period of years is why we are in the financial trouble we are in!

Well, the special deficit reduction committee is supposed to produce its plan by Thanksgiving. Then if Congress rejects the panel's recommendations, an automatic $1.2 trillion in spending cuts will go into effect a little over a year later, with half of the cuts being from national defense.

It should be obvious to all of us that a committee is not an ideal way to reduce excessive spending. But with our debt already huge, and with our annual budgets long in red ink, this is the plan Congress has adopted.

The automatic cuts would not take effect till January 2013. By then, our debt will be much larger. Nevertheless, when the cuts are identified, expect a lot of objections -- not only from members of Congress but also from many taxpayers.

Do you believe this plan will work? If not, how would you propose that we cut spending to slow the growth of our national debt?

The committee has a tough job to do by Thanksgiving. We'll know then whether we'll be "giving thanks" for its efforts.

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charivara said...

Is it that hard to understand that the money the federal government spends is money that the Congress mandated? The current debt is largely a result of unfunded wars, a prescription drug program that was a windfall for the pharmaceutical industry and tax cuts favoring the very wealthy. Republicans are largely responsible for these and now they sanctimoniously, with the connivance of editorialists like this one, are railing against the evils of the huge debt they created. It’s one thing to curb spending, it’s another to refuse to pay for spending that you have authorized. The whole “debt crisis” is a manufactured ploy by Republicans to force their ideological agenda on the American working and middle class. The refusal to consider any revenue increase to pay for their previous largesse is ample proof of that. Republicans blame the federal government as if they are not part of it and bear no responsibility for its actions. They are an embarrassment to this nation and the history their party represents.

August 5, 2011 at 8:40 a.m.
Plato said...

Great perspective charivara - I agree 100%

What would I do? To start I would cut our Trillion dollar a year world police force that we can't afford in half. There is not one logical reason why a country protected on 2 sides by allies and the other 2 by oceans has to spend the equivalent of what the rest of the world combined spends on "defense". There is also no logic in borrowing money from Korea, Japan, Germany and others to send troops and weapons to those same countries to defend them. They're grown ups, let them defend themselves.

The second thing I would do is to create a war on obesity. If we could eliminate obesity in this country health care costs would be cut in half. That's plenty enough to keep medicare and medicaid solvent and functional for many decades to come.

The last thing I would do is implement the president's Infrastructure Bank. We can borrow money at 2.4% right now to fix bridges, roads, dams and electrical grids that are outdated, and in some case obsolete and dangerous. It has to be done sometime, why not do it now? The return in revenue from the jobs created would more than offset the cost of borrowing and it would get people back to work and grow the economy while achieving a needed purpose.

Having said that, none of this will happen until we get the money out of politics and/or implement term limits. I'm not holding my breath for that to happen anytime soon.

August 5, 2011 at 10:46 a.m.
EaTn said...

charivra and Plato--very good common sense of the issues and solutions.

August 5, 2011 at 11:03 a.m.
TNProgressive said...

Spend. Spend like the hounds of hell. Spend on infrastructure. Build roads, bridges, and the institutions of a civilized society. Spend. Spend on providing food to the many millions of this land who are hungry. Create Green industry, quickly. Yes, spend.

The Private Sector is sitting on hundreds of trillions of dollars that they are not, save forceful action, going to release into the economy. The corporatists are not going to create AMERICAN jobs, while hording their stolen taxes due in Zug, Switzerland. They will offhhore to Korea and Vietname, where $0.34 per hour is executive wage. Spend. Public sector jobs are being forecefully drained by Tea Party Terrorists, who only wish to live long enough to see the total elimination of the American middle class, and the reformation of the United States into the corportist theocracy they believe it should be, absent, gays, black, women, intelligent citizens, and those who believe that democracy is worth dying for.

Spend, until it is enough. Remove this dreadful constitutional lynch mob from our presence through the election of progressives who understand that when there are no jobs, there IS no economy. Retrieve the stolen tax payments, jail the perpetrators of the financial debacle, and reclaim the American Dream for all the people of this land.

Spend, until the coffers once again overflow with the hard-earned tax dollars of her citizens, who demand our democracy back. Remove the evil Bush Tax cuts, and return fairness and equality to the American landscape. If you are unwilling to properly and timely pay the taxes on the billions you have so selfishly gained, at the cost of so many, your physical plants must be siezed, your Boards jailed as the corporate criminals they are, and your "citizenship" of this nation revoked. Rather a man with a knife, whittling a clothes pin than a machine stealing our wealth and our future.

Spend, I say. Seize back to the Treasury the balance owed. Feed the hungry, heal the sick, and allow our veterans and seniors to live their days with dignity, respect, and healthcare. Educate our children, our hope for tomorrow. Yes, spend. Do it now. Repeal this ridiculous panel of 12. This is NOT representation! It is left to the people to defend their nation from these corporatists, and ultra-conservative right wing nut jobs. They are not different, and they do not wish our nation well. They are evil, and wish only for the elimination of our land.

That's what I would do.

August 5, 2011 at 11:37 p.m.
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