Obama: Cutting deficit as important as job growth

[laughingliberal]

By DARLENE SUPERVILLE, Associated Press Writer – 36 mins ago
WASHINGTON – Trimming budget deficits is as important as creating jobs to sustain the economic recovery, President Barack Obama said Saturday.
The government reported Friday the economy grew at an annual rate of 5.7 percent in the final three months of 2009. It was the second consecutive quarter of growth and the fastest rate in more than six years.
"A sign of progress," Obama said in his weekly radio and Internet address. "But as we work to create jobs, it is critical that we rein in the budget deficits we've been accumulating for far too long."
Hammered by Republicans for billions of dollars in spending that added to the deficit, Obama outlined steps he said would rein in spending. They include rules requiring that spending or tax cuts be offset by cuts to other programs or tax increases, a freeze on most discretionary spending and a presidentially appointed commission to recommend ways to reduce the deficit.
Obama said "pay-as-you-go" rules that were in place in the 1990s led to surpluses at the end of the decade. But after Congress eliminated the rules, Obama said the result was the $1.3 trillion deficit he faced upon taking office in January 2009.

http://news.yahoo.com/s/ap/20100130/ap_on_bi_ge/us_obama_deficit


I really wish they would enact some strong job creation measures and let them work before they cut much spending. Putting people back to work and, therefore, increasing the tax base will achieve some deficit reduction on its own.

[MadHound]

1. I really wish that they would put military spending on the chopping block

After all, if they end the wars the defense budget could be cut in half and we would still be the biggest badass on the block.

Instead we're pursuing the Soviet style of collapsing, taking more and more money from the people in order to continue to feed the military.

[Yurovsky]

2. Can't put people back to work w/o spending $$$

it's not like folks are going to work for free. You want to create jobs you're going to have to pay people, it's kinda of how the whole "job" thing works.

I'm hoping someone in the administration realizes this before they vote to freeze spending while we have >10% unemployment...

[Name removed]

3. Deleted message

Message removed by moderator. Click here to review the message board rules.

[laughingliberal]

11. The biggest waste in the Recovery act was 40% diverted to tax cuts

Although it was nice to see the working and middle classes get a tax cut for the 1st time in decades it was not as stimulative as infrastructure/building projects would have been. Unfortunately, we had to get 3 Republican votes to break the filibuster and they insisted on trimming the package down from the minimum $1 trillion most economists felt would be needed for adequate impact and diverted 40% to tax cuts.

[fasttense]

13. The bubbles and crashes are due to lowering the top marginal rate of income tax on the uber wealthy.

"◦Large income tax cuts are followed by a bubble and then a crash.
◦High income taxes correlate with economic growth.
◦Income tax increases are followed by economic growth.
◦Moderate income tax cuts are followed by a flat economy.
◦All of this is especially true as applied to the top tax rates, the amount paid on income that exceeds the highest bracket."

http://www.alternet.org/economy/106410/tax_cuts:_the_b.s._and_the_facts/

These so called business cycles are of our own making. We could have stable growth and a smooth economic pattern if we stopped turning over our money to the uber rich. If we were to eliminate the Reagan tax cuts and stop funding the bush wars, than we could balance the budget and fund the social programs Americans want and need. Why does the military get a pass on budget reductions? I was in the military for 20 years and handled very large budgets. I guarantee there is a lot of spending waste in the military.

But eliminating tax cuts for the rich and ending useless wars, would mean the uber rich would have to pay their fair share and couldn't feed off the government dole in the form of military contracts.

The stimulus President Obama and the Congress approved did prevent a larger unemployment rate but it wasn't enough to stop this 2nd RepubliCON Great Depression. A public works program much like FDR's could reduce the unemployment rate but there is no political will for it.

[Pab Sungenis]

4. He is right, to a point.

The real problem with big Federal deficits is that they eat up a lot of the credit market. Every dollar that the government borrows is, in theory, one dollar that won't be there for the private sector to borrow. This especially hurts small businesses in cash crises.

The deficit needs to come down. The problem is how we're going about it.

[Ardent15]

6. Cutting spending on the MIC would be a start. nt

[Kurt_and_Hunter]

9. RW talking point of limited truth

Not an accusation -- i am addressing the argument, not the speaker.

In theory the deficit does that.

In practice it does not in circumstances like ours.

[laughingliberal]

12. I hope he has someone that knows what they are doing

Cutting spending in the midst of this recession is risky.

[Kurt_and_Hunter]

5. If the President says something monstrously stupid can we say so?

Because he seems to have done just that.

[Nite Owl]

7. I could understand

cutting spending on some things but it has to include the Pentagon. Lots of waste there and if we really need a war there should be an automatic tax to pay for it. A lot of our military excursions would stop.

[UglyWarrior]

8. The recent spending freeze will cut deficit by 0.5%

Correct me if I'm wrong.

[Coyote_Bandit]

10. I suspect

his priorities might be different if he or Michelle were unemployed.....

[TheWebHead]

14. if you see what's been happening in Ireland or Greece

then one can better understand the implications of ignoring mounting debt... dealing with it while remaining competitive and encouraging investment will require a combination of higher taxes and reduction in entitlement programs. Advocating one of those two options is politically dangerous, but doing both is political suicide, hence we are where we are.

[Unvanguard]

15. Job growth IS deficit reduction. And the way to reduce the deficit is through long-term measures.

Things like stimulus packages are not the problem: they will worsen the fiscal situation for a year, then go away. Things like huge fiscally-irresponsible tax cuts, foreign wars, and out-of-control health care costs are the real problem.

[laughingliberal]

16. Exactly! nt