House Budget Cuts Too Little Too Late
WASHINGTON: Saturday saw the House pass a $1.2 trillion continuing resolution to fund the government through the rest of this year. The resolution contains cuts totaling $61 billion. Cuts target NPR, Planned Parenthood, border security, education and other federal programs. Senate Majority Leader Harry Reid and other senate democrats have called the measure “extreme.” Speaker of the House John Boehner has threatened a shutdown of the federal government if the resolution is not passed. Obama and the democrats have vowed a fight on Boehner’s threat to shut down the government.
With all the posturing on both sides it is easy to not see the forest for the trees. $61 billion is only 5% of $1.2 trillion dollars. The US will have to borrow $516 billion to finance the $1.2 trillion and our politicians are arguing about defunding NPR and Planned Parenthood? What is needed is a much larger cut, say $516 billion.
Let’s look at it this way. Your household has a credit card limit of $25,000 and you are over the limit by $10,000, owing a total of $35,000. Your bank calls you to reign in spending and threatens to report you to the credit agency and downgrade your credit (think Moody’s). You tell the bank how serious you are about cutting back, and you tell your banker that you were thinking about adding another $20,000 to your debt this year but are going on an austerity spending program and are only going to spend another $19,000, that will hold your debt to “only” $49,000. That’s the kind of “extreme” fiscal discipline the Republicans are suggesting.
BTW- your share of the Federal debt? $45,000 and climbing. (See the live counter to the right.) You will need to pay it back. Why aren’t you angry?