All News

Tackling The Deficit, Trimming The Fat

One expert has some long-term advice for the president-elect.

Federal News Network Staff

November 26, 2008 1:30 pm

2 min read

By Robert Laurence
FederalNewsRadio.com

With the deficit nearing $1 trillion, President-elect Barack Obama has vowed to cut inefficient programs while at the same time promising serious spending to fix serious economic problems. James Horney, the Director of Federal Fiscal Policy at the Center on Budget and Policy Priorities, tells FederalNewsRadio that he believes no amount of cuts can eliminate the deficit brought about by the economic downturn.

When you add all of that up you are almost certainly looking at a deficit for this year that’s going to be a trillion dollars or more and a deficit probably of the following year that’s going to be something approaching that. So I don’t think President-elect Obama is saying that he is going to find cuts in spending that are even going to begin to significantly reduce that deficit.

Even though the dollar amount of the cuts would only put a small dent in the deficit, Horney believes that cutting wasteful programs does serve an important purpose.

“You can try to show people that you are concerned about what’s going on by identifying some wasteful spending, some money that we are spending that’s not helping to shore up the economy,” Horney explains.

Short-term aside, Horney believes the key is in the long-term plan for deficit reduction.

“What really matters is what happens in the long run as we come out of this economic downturn will President-elect Obama have a plan that shows how we can get on a path to long-term reduction in the deficits,” Horney says.

With the long-term in mind, Horney sees health care reform as the key to getting on a path to eliminate the deficit.

“To deal with the long-term deficit, which is really driven by those health care costs, you need to get the overall increases in per-person health care costs under control,” Horney explains.

—–
On the Web:

Federal deficit could hit $1 trillion this year