Even without the sequestration, America’s debt will be completely stabilized at 73 percent of Gross Domestic Product by the end of the decade with just $1.5 trillion more in savings, according to a new study from the Center on Budget and Policy Priorities.
The cuts agreed to in 2011 and the savings from letting the Bush tax breaks on the richest 1 percent expire have already put a serious dent in the short-term debt expectations.
Stabilizing the debt with $1.5 trillion more in savings — $1.3 trillion from cuts and $200 billion from interest savings — will give policymakers breathing room before making serious cuts to Medicare or Medicaid, where — as White House spokesman Jay Carney pointed out today — our spending problem really is.
“One concern is that enacting steeper deficit reduction now could lead policymakers to make decisions, particularly in the health care area, where desired solutions currently are elusive and where knowledge about effective ways to slow health care cost growth is likely to be greater in coming years due to changes underway in the health care sector and various research and demonstration projects,” the study says.
Our real spending problem right now is that we’re not spending enough.
As President Clinton told House Democrats on Friday, America both needs to avoid cuts in the short term and also recognize that we have a long-term debt problem, especially if interest rates begin to rise. This study says we can do both.
But first we need to avoid the sequestration, which could easily cost the economy 600,000 jobs just as the housing market begins to show some serious signs of recovery.
Until the deal on the “fiscal cliff,” Republicans hated the sequestration — it was designed for them to hate it, with most of the cuts coming from defense.
But the Party of Reagan has become the Party of Norquist.
Smarting from the uncomfortable and unfamiliar feeling of compromise after the “fiscal cliff,” they decided that they could never ever ever agree to any tax increases again. They decided to simultaneously accept the sequestration and blame the president for coming up with it.
They’re hoping that the public forgets that they forced the sequestration when they refused to raise the debt limit without cuts. And they voted for the cuts.
The Washington Post’s fact-checker, Glenn Kessler, looked at the Republicans’ attempt to stick the sequestration on the president and found “…Republicans agreed to this plan and thus also are equally responsible for the looming across-the-board cuts, absent a bipartisan agreement to delay or change them.”
In 2011, the GOP refused to pay for the debt they help rack up. In 2013, they’re blaming the president for a bill they voted for, all in the name of a debt problem we can easily control with a small balanced deal of cuts and ending tax breaks.
But clearly the GOP is more concerned about punishing the president than dealing with the reality of of the situation.