Rep. Paul Ryan and Sen. Patty Murray Tuesday evening announced a budget deal they say restores “regular order” to the federal budget and spending process. Overall spending in fiscal year 2014 would be $1.012 trillion, and overall spending in fiscal year 2015 would be $1.014 trillion. The agreement replaces $63 billion in sequester cuts with a combination of other savings and includes an additional $22.5 billion in deficit reduction.
The following statements from budget and tax experts at The Heartland Institute – a free-market think tank – may be used for attribution.
“Congress hasn’t passed an actual budget since 2009. For the sake of ‘regular order’ in budgeting, Ryan and Murray have agreed to gut the sequester cuts that have helped bring a semblance of fiscal responsibility to federal spending. They agree to send spending higher in the near term in exchange for a net deficit reduction of $22.5 billion over the long term. The federal government spends approximately $10 billion a day, so they’re trying to make a big deal out of saving two days of spending.
“And no Congress can force a future Congress to do anything, so all we know for sure is that we’ll soon see higher government spending. Considering the dismal history of promises of future fiscal restraint, it’s a safe bet the promised long-term deficit reductions will never happen.”
“This unremarkable budget compromise is all about November 2014: both Republicans and Democrats want to avoid being held responsible for ‘gridlock.’ But that means the one pressing issue on the table will be Obamacare, which is doing huge damage to only one party. Thus the budget deal, if it ultimately passes, could have big political implications by default.”
“President Barack Obama calls the budget deal ‘a good first step.’ Is this actually an admission that, after being president for five years, the country is only taking its first step? Or is this merely a political throwaway line? The country has actually already taken a series of steps toward resolving the unsustainable deficit that opened up in conjunction with the fiscal crisis of 2008. Following the Tea Party surge of 2010, the House of Representatives began to wrestle with its counterparts in the other chamber and with the president regarding spending and tax policies. The process has not been pretty.
“From $1.3 trillion or $1.4 trillion deficits during 2009–11, the deficit fell modestly to $1.1 trillion in 2012 (reflecting the beginning of the process we are now in), and to $700 billion in 2013. Together with an economy that is growing at a modest rate, the deficit as a percent of GDP has fallen by a bit more. The budget deal should bring us to a sustainable ratio of debt to GDP over the next two years. This progress is faster than was ‘promised’ by either major party candidate in 2012.”
“Congratulations to Congress. It has finally figured out how to ‘play nice’ in the sand box long enough to get elected again in 2014! Hopefully, members of Congress have learned a lesson and will continue to run the country in a responsible manner and leave partisan games out of the equation.”
Scott H. Richardson
Partner, Richardson and Ritchie Consulting
“This all amounts to band-aid work, nothing substantial.”
Tibor R. Machan
Professor Emeritus of Philosophy
R. C. Hoiles Endowed Chair in Business Ethics and Free Enterprise
Argyros School of Business & Economics