Monday, February 23, 2009

AP: Obama pledges to cut deficit in half

See here.

How will he do it?
"he wants to reinstate a pay-as-you-go policy on federal spending programs, get rid of programs that do not work and end tax breaks for companies that ship jobs overseas."
Pay-as-you-go = the bill for all of the profligate spending of the last decade, and which continues today, will come due in the form of higher taxes.

6 comments:

Jamie said...

hmm, didn't he just ADD to it?

David said...

"reinstate pay-as-you-go"?

Can anyone remember the last time Congress tried pay-as-you-go (not counting the blip after the '96 elections when Republicans brought the government to a standstill as they fought the democratic president)?

Anonymous said...

Seems like ending that war Bush got us into would be a big help.

Cameron said...

Perhaps, but Obama just sent 17,000 more troops to Afghanistan.

Democracy Lover said...

Pay-as-you-go, like other budget balancing tricks, is stupid. There are always times when it makes sense to enlarge the deficit in order to achieve some more important goal. In the current case, that goal is getting the economy back on track.

Obama is wrong to be worried about the deficit now. He can and should review federal programs to eliminate waste (beginning with the Pentagon). He should eliminate tax breaks for business that were intended to stimulate some action like job creation or retention but did not work. But to start looking for ways to cut spending when the economy needs a stimulus is counterproductive.

Once we get over the current hump, I would advocate that we roll back the Reagan tax cuts and return to the tax policy of the Nixon years. That and an end to military interventionism would balance the budget nicely without gimmicks.

Cameron said...

I have no fear that Obama will drastically cut spending.

Of course, that only leaves one alternative if he institutes PAYGO rules.