Two underreported facts about federal deficit reduction

Deficit reduction graphIn the incessant yammering that continues about the federal budget deficit, one of the great underreported facts in recent months is that President Obama and Congress have actually already made enormous progress.

As Richard Kogan of the Center on Budget and Policy Priorities and Allan Freyer of the Budget and Tax Center have reported here and here, the fiscal cliff deal combined with other decisions have combined to slash the projected deficit over the next decade by $2.7 trillion. Indeed, with another $1.5 trillion in savings/tax increases, the country will be in a good place on this issue.

Today, Kogan highlights (see the graph at left) another related and underreported fact about the deficit reduction already enacted: the vast majority of it (70%) comes from program cuts.  Kogan’s data provides more compelling evidence that tax increases simply have to be a part of any new federal budget deal if the’re going to be a truly balanced approach to deficit reduction that doesn’t throw the country back into recession with Europe-like austerity.

9 Comments

  1. Doug

    April 9, 2013 at 3:55 pm

    $270 billion on a $1.3 trillion per year deficit is certainly progress, but only about 25% of the way we need to go. And I am actually being liberal with that statement.

  2. david esmay

    April 10, 2013 at 10:21 am

    Here’s the Republican/Conservative lie in a nutshell, as Calvin Johnson, professor of tax law at the U of Texas disclosed through his Shelf Project in State Tax Notes, Congress could raise more revenue just by closing loop holes and fixing flaws in the tax laws to the tune of 1 trillion dollars a year, enough to balance the budget in 2013. Corporations enjoy private profit and socialize their losses under our current system of windfall profits through tax breaks and official favors that do not produce economic growth or jobs. The point of implosion was Ronnie Raygun’s disastrous Economy Tax Recovery Act of 1981. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1636915

  3. Alex

    April 10, 2013 at 11:55 am

    It looks like esmay has gone back in this time machine to 1981. Can someone please lock the door, so we won’t have to endure this anymore ?

  4. david esmay

    April 10, 2013 at 12:00 pm

    Stop trolling on Policy Watch Alex, it’s as simple as that. Since you never cite anything to contradict any statements or support you own, maybe your time would be better served trolling your employer’s website. Many economists and historians use that destructive piece of conservative b.s. as a bench mark.

  5. david esmay

    April 10, 2013 at 12:02 pm

    Alex where were you in ’81? I was TDY from Bragg in Honduras.

  6. Alex

    April 10, 2013 at 2:08 pm

    Reagan led this country back from one of the worst recessions in our history after the malaise years of Jimmy Carter, and some economists say it was possibly the worst. You simply don’t know what you’re talking about with a lot of economic issues. If you want to comment, at least check your facts more carefully.

  7. david esmay

    April 10, 2013 at 2:49 pm

    Reagan sent us down the road of massive debt and deficit spending, if you want to re-write history in order to paint your party and it’s demigod in a better light I suggest you do it at your Civitas website, who’s followers are the only one’s who believe that crap. Your are argument has no facts, considering Bartlett and Stockman contradict everything you claim as fact. You simply repeat neo-con talking points and pass it off a “facts”. Most economists agree that Hoover, Dubya, and Reagan rank among the worst.

  8. david esmay

    April 10, 2013 at 2:52 pm

    Also Alex, Reagan inherited an economy that was in much better shape than the one President Obama inherited and no economist makes the claim that the late seventies were in any way shape or form what Hoover and George the Dullard left behind.

  9. Alex

    April 10, 2013 at 6:52 pm

    As usual david your facts are totally wrong. Reagan contributed $ 1.4 Trillion to the national debt in 8 years, which was mostly defense outlays for the military. Obama contributed $ 5.7 Trillion in only 4 years, and continues to run almost a trillion a year in this term with red ink as far as you can see. There is no comparison whatsoever. A fourth grader with basic math skills could understand this, so why you insist on putting out bad information is beyond me.