Pres. Obama wants to offset some of the Federal spending by cuts in the budget. A noble idea but how will that help? And just how effective will the cuts be at making the government more fiscally responsible?
White House aides said the president plans to release a list of 121 programs from weapons systems to education to the cleanup of abandoned mines where savings could be found.
He is under pressure to signal a willingness to tackle budget deficits amid White House projections that the government shortfall will reach an enormous $1.75 trillion in the current 2009 fiscal year.
The administration expects the deficit to drop to a still-high $1.17 trillion in the 2010 fiscal year that begins in October.
The proposals will be included in a new White House book of terminations, reductions, and savings, as well as a separate appendix detailing line-by-line spending. Next week, the administration expects to release a volume of “analytical perspectives” explaining its decisions more fully, as well as new tables outlining its projections for spending, taxes, and deficits.
Other cuts include eliminating the Education Department’s Paris attache, which the White House estimates will save $632,000, and a $35 million long-range radio-navigation system that the administration found was obsolete because of global-positioning satellites.
Several housing and education programs are also likely targets for elimination. OMB has found that the American Dream Downpayment Initiative, which helps first-time buyers purchase homes, “is too small to operate effectively,” and the Community Development Loan Guarantee program does not properly encourage large-scale local developments.
Obama also wants to tighten tax laws for U.S. multinational companies and wealthy individuals who invest overseas. The White House estimated the proposal would save $210 billion over the next decade, but the idea, which faces strong opposition from businesses, has received only a lukewarm reception in the U.S. Congress.
Republicans have charged that Obama’s budget would hamper economic growth by increasing the size of government and exacerbating deficits. Obama has pointed out that he inherited a more than $1 trillion deficit from former President George W. Bush, a Republican.
Deficits have skyrocketed since last year as the recession has weakened revenue and the government has spent billions to bail out troubled financial institutions and to throw a lifeline to distressed U.S. automakers General Motors and Chrysler.
Granted that the proposed cuts amounts to less than 1%, it is a start and should continue. But to say that the budget is under the knife is just plain wrong……it is more like taking the stem out of the apple…..does very little to the apple, but you feel that you have accomplished something.