Deficit Grows to $1.5 Trillion, ALG Urges Action Now

January 26th, 2011, Fairfax, VA—Americans for Limited Government (ALG) President Bill Wilson today urged congressional action to reduce the 2011 budget deficit, which the Congressional Budget Office now projects will be record $1.5 trillion this year:

“Once again, the budget deficit is growing under Obama’s watch, this time to $1.5 trillion, mostly because of the unpaid-for $56 billion extension of unemployment benefits and a $120 billion cut in payroll taxes on employees from December’s tax deal. Because there were no offsetting spending cuts for these items, we are just digging ourselves deeper into a hole of a debt that surely will hinder the economy for some time to come.

“It is now up to House Republicans to put serious spending cuts on the table. Barack Obama is merely proposing a discretionary spending freeze, which will institutionalize spending at its record-high levels and do nothing to decrease the deficit. This is a pathetic proposal that merits no serious consideration.

“Representatives Jim Jordan and Scott Garrett and Senator Jim DeMint have proposed $173 billion of discretionary spending cuts over the next two years, $16.1 billion in cuts to Medicaid, end the ‘stimulus’ saving $45 billion, and ending government ownership of Fannie Mae and Freddie Mac, saving another $30 billion. These cuts represent a good start, and could be attached to a continuing resolution due to expire on March 4th. But more must be done.

“Congress needs to put so-called ‘mandatory’ spending on the table for immediate consideration. This spending is on autopilot, and if Congress does not act, will continue to increase year on end. As much as $460 billion of cuts could be attached to an upcoming vote to increase the national debt ceiling above $14.294 trillion. Combined with the Garrett-Jordan-DeMint proposal, the savings would total $725 billion, cutting the deficit in half.

“Politicians like Obama need to stop fiddling while Rome burns. Spending needs to be cut significantly, not frozen. And it’s up to House Republicans to put those cuts on the table before it is too late.”

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