A new analysis by the Committee for a Responsible Federal Budget shows just how far out of control the federal budget has gotten after years of deficit spending and two years of President Joe Biden’s spending bills.
The federal budget will have to be cut by 26% across the board in order to balance and end years of deficits, the analysis said.
If lawmakers want to exempt defense, veteran benefits, Social Security, and Medicare from any cuts, they would have to cut everything else by 85%.
“Due to continued borrowing over the past several years, the desirable fiscal goal of budgetary balance has become much more difficult to reach, and it is highly unlikely it could be achieved in a decade or less, particularly if revenue, defense, and other parts of the budget are excluded from the solution,” the analysis said. “We recommend Congress adopt an aggressive but achievable fiscal goal in its budgets and any fiscal deals.”
Budget cuts may be coming
The reality of these cuts could mean that millions of Medicare recipients will lose eligibility, and over a million federal employees could be dismissed.
“Wanting to balance the budget is an admirable and desirable goal. However, the path to get to balance within ten years is likely infeasible, and it is virtually impossible if major parts of the budget and tax code are exempt from change,” the analysis continued. “Policymakers should set aggressive but realistic fiscal goals, should keep all areas of the budget on the table, and should put forward policies to begin reducing deficits. The first step, of course, is to avoid actions that would worsen our already unsustainable fiscal situation. Policymakers should agree not to pass legislation that calls for any new borrowing. We commend the adoption of a specific and realistic fiscal target.”
Some level of budget cuts could become a reality after new House rules require an actual vote to increase the debt ceiling, as well as spending cuts that balance out any new spending.
Spending is rapidly reaching the current debt ceiling limit–currently $31.4 trillion–as inflation and higher interest rates have eaten up larger and larger portions of the available cash.
It’s getting real
Republicans have paid lip service to balancing the budget for years, but may finally be getting to the point where they try to take action to achieve it.
If the Freedom Caucus can hold moderates’ feet to the fire, actual cuts may happen rather than just spending less than the Democrats, which has been the game plan (it seems) since George H.W. Bush was president.
Granted, it’s scary to make budget cuts in an era where Democrats will scream that the GOP is throwing granny off a cliff, but if the last two years have shown us anything, it’s that unfettered spending is worse for the economy than almost anything else politicians can do.
The GOP just has to hope that voters will understand that cuts are needed if we don’t all want to fall off a cliff financially.
I really don’t want to be the next Venezuela.
If Republicans can prevent that, they deserve to be in power for a very long time.