The British royal wedding was splendid, and the bride and groom were a great match. As a fiscal wonk, my idea of a royal match-up would be marrying corporate tax cuts and business subsidy cuts. The Obama administration is talking about corporate tax cuts and Republicans are talking about cuts to farm subsidies. Might they get together over a cup of tea and work out nuptials?
In my quest to downsize the government, I’ve been looking at the Department of Labor budget recently. My vision is to cut federal spending to create a freer and more prosperous society. James Madison’s vision was for a federal government of “few and defined” powers.
The government’s air traffic controllers have been sleeping on the job, watching movies rather than guiding planes, and misdirecting the First Lady’s plane over Washington. There have been soaring numbers of airplane near misses caused by ATC errors over the last year.
My colleague, Tad DeHaven, showed us yesterday that even with the roughly $40 billion spending cut, total outlays will still rise substantially this year, fiscal 2011.
President Obama says that he supports a “balanced” plan of tax increases and spending cuts to tackle the government’s huge debt. The problem is that the fiscal mess in Washington is far from balanced.
Republicans and Democrats are currently battling over $61 billion, or less, in federal spending cuts for the remainder of the current fiscal year. The chart below puts that figure in perspective. It shows the annual increases in total federal outlays each year over the last decade.
House Budget Committee Chairman, Paul Ryan, introduced his budget resolution for fiscal 2012 and beyond today entitled “The Path to Prosperity.” The plan would cut some spending programs, reduce top income tax rates, and reform Medicare and Medicaid. The following two charts compare spending levels under Chairman Ryan’s plan and President Obama’s recent budget (as scored by the Congressional Budget Office).
The Washington Post said today that a plan to “cut $33 billion from the federal budget” would be “the largest one-time reduction in U.S. history.”
The federal government is approaching its legal borrowing limit, and fiscal conservatives in Congress are wondering what spending reforms they can extract in return for supporting a debt-limit increase. Various sorts of balanced budget amendments and debt limits relative to GDP are being kicked around. I support those ideas, but I fear that they may be too complicated to gain traction right now.