Did Chris Coons Catch Budget-Cutting Fever?
We live in interesting times. We’re in a time of budget deficit panic, while at the same time cutting taxes. In fact, one party will not even consider increasing revenues through taxation. So, it’s budget cutting fever. Slate‘s Dave Weigel talked with Chris Coons and reported that he seemed to be open to the idea of cuts to entitlements.
“The framework that was laid out by the deficit commission, while I don’t agree with everything they did, shows the direction I think we need to go in terms of scope,” said Coons. “If we simply look at the 12 percent of the budget that’s non-discretionary spending, we’re never going to get there. I think we need to be doing the large work.”
He had been bristling to ask OMB Director Jack Lew a question.
“Why do you think 3 percent of GDP is a sustainable deficit?” asked Coons. “Don’t we need to get to a balanced budget, in order to get to the point where we’re tackling the debt?”
I don’t disagree with anything in that statement by Chris Coons. The budget Republicans seemed to be obsessed with is very small with regards to the overall budget. The cuts they are proposing will do very little to tackle deficit. The major expenditures are entitlement programs – Social Security, Medicare, Medicaid and the Defense Budget. If we are really, really serious about the budget, we have to address these.
Maybe it’s an assumption on Weigel’s part that Senator Coons is addressing just entitlements. When the article came out, I and others started tweeting to Chris Coons. I addressed three main points: 1) “shared sacrifice” means the rich need to sacrifice 2) the main problem in entitlement spending is Medicare and the rising cost of healthcare in general and 3) Social Security does not contribute to the deficit. Chris Coons responded that he agreed with all three points – though it won’t hurt for everyone to contact him and make sure he’s protecting Social Security.
Tags: Budget, Chris Coons, Social Security
President Obama’s proposed FY2012 budget assumes that total federal taxes, as a percentage of GDP will rise every year, from 14.4% in FY2011 to 16.6% in FY2012 all the way to 19.3% in FY2016. His numbers include elimination of the 2001/2003 tax cuts for the top producers. But even with that, his budget also assumes constant government spending in the range of 22.3% to 23.6% of GDP. There’s just no way that can work.
President Obama said he wanted to take “a scalpel…not a machete,” to the budget. The problem is that he needs to take more than a machete to the budget; he needs to take a meat-axe to it!
The problem is that he needs to take more than a machete to the budget; he needs to take a meat-axe to it!
This is simply a conservative wet dream. It is crazy talk. Dramatic budget cuts would be irresponsible and in fact have never been done, let alone been successful.
Every decline in the deficit in has been accomplished gradually through modest spending restraint and revenue growth. That is the responsible and technically correct way to reduce a deficit.
In modern times, every major increase in the deficit is correlated with tax cuts for the wealthy. This is how we know supply-side doesn’t work.
During a recession, or during this current weak recovery, the trick is to restrain structural spending while increasing temporary spending on relief and stimulus programs. And that appears to be roughly what Obama is doing.
As long as we pretend we can’t address the defense budget, deficit reduction will be a political parlor game.
We need to address jobs before the deficit. Getting more people to work will do more to close the deficit than the cuts the GOP proposes. Jobs first, then deficit. Jobs are a short-term problem. The deficit is a medium to long term problem.
And on WDEL Coons was calling for “hard choices.”
I think anybody who voted for $700 billion in tax cuts for the rich needs to maintain a respectful silence about “hard choices.” Voting for tax cuts for the rich is one of the easiest choices a politician can make. It is falling-down-into-a-featherbed easy, which is why so many Democrats did it. It is not an example of a hard choice. It is an example of avoiding a hard choice.
Thank you, Democrats, for making these new hard choices necessary.
“tax cuts for the top producers”
Wonder example of Stockhold Syndrome, that.
Obama2008 wrote:
If you look at President Obama’s own numbers (from the Historical Tables, Table 2), you’ll see that the last time we had a balanced budget, total federal outlays were reduced to 18.2% of GDP, while taxes were around 19.5% (FY2001). President Obama is projecting increasing government revenues, from 16.6% in 2012, to 17.9 in 2013, to 18.7% in 2014, to 19.1% in 2015, to 19.3% in 2016, getting pretty close to that 19.5%, but he projects total spending to stay in the mid 22% range. There’s no “modest spending restraint” there, but levels very close to what he called for with his stimulus plan, for as far out as he projected the budget.
If we were both prosperous and had a balanced budget with the federal government spending only 18.2% of GDP, why must we spend 22.6% of GDP?
There’s also the rather obvious fact that the public do not want to pay higher taxes. This being a democratic representative republic, that fact has to be taken into consideration. Heck, even President Obama ran on cutting taxes! But, then again, he also ran on cutting spending.
“There’s also the rather obvious fact that the public do not want to pay higher taxes.”
Actually, the public is firmly in support of higher taxes on the top 2% of income earners. And if it were put to them properly, they would be in favor of raising taxes on people who live off the work of others — at least to equalize it with people who actually work.
There’s also the rather obvious fact that the public do not want to pay higher taxes.
The public does not want to pay ANY taxes. The Republic will crumble into dust before the public WANTS to pay taxes.
if we were both prosperous and had a balanced budget with the federal government spending only 18.2% of GDP, why must we spend 22.6% of GDP?
Because we aren’t expected to be exactly prosperous even by 2016.
Descending from a stimulus-spending peak of 25.3%, 22% does represent not only a restraint but an actual cut. You are still seeking the meat axe.
The sins of the past have created a fairly long-term need for social relief spending. Spending will continue to track downward as employment increases, and the demand for need-related benefits declines (unemployment, Medicaid, etc).
The 1990s run at a balanced budget was characterized by better-than-expected GDP and revenue growth that surprised CBO and exceeded their projections and caused them to issue new more optimistic projections each year.
Not to mention, the spending environment is different from previous times because health care is now a bigger piece of the pie, and little has been done at enormous effort to solve that problem.