Search This Blog

Wednesday, August 3, 2011

Time to look forward which strangely looks like we are repeating history

Now that the debt ceiling deal has been reached, it is a good time to look forward to see what will come up in Washington in the next month or two. Fortunately for the country, Congress is now in recess for the rest of August. So far, so good. Once Congress comes back, however, it will need to pass appropriations bills for the fiscal year that starts on October 1, 2011. If you remember the continuing resolution that was the center of major fighting last March, you should also recall that the CR runs out when the fiscal year ends. Hopefully, Congress will pass appropriations bills for the various departments (or at least some of them) so that there will not be a need for an overall CR once again. If, however, there are no appropriations bills, then there will need to be another CR or the government will shut down. Sound familiar?

My guess is that the GOP will have a new batch of budget cuts that it wants to make to the appropriations. For example, the 100 or so federal job training programs could be amalgamated into two or three. This would save about three quarters of the administrative costs spent on these programs without in any way reducing the people receiving training. In short, it would be a no pain with gain type of cut. There are literally hundreds of billions of dollars of spending that can be cut in this way. Or suppose that the GOP decideds that it is going to cut funding for the federal program that provides free cell phones to the "poor". That would mean another savings with little downside. At some time, the feds have to decide that not all entitlements have to be treated as rights. Some, in fact, are luxuries.

There will be a whole series of these items brought forward by the GOP. Hopefully, president Obama will handle these as well as he did the last and there will be a victory for fiscal sanity.

No comments: