Historic Spending Cut Bill Actually Increased Budget Deficit By $3 Billion
It turns out that the budget deal that ended the government shutdown fight last month didn’t amount to much at all:
WASHINGTON (AP) — The big spending bill passed into law with much fanfare last month will cut the deficit by $122 billion over the next decade — less than half of what top lawmakers promised at the time — the government reported Monday.
Speaker John Boehner, R-Ohio, had touted the legislation as reducing the deficit by more than $300 billion over a ten-year span. His prediction was based on an analysis by a Senate aide that the $38 billion in cuts this year would translate into $315 billion over a decade.
But the Congressional Budget Office, the closest thing to an official referee, said Monday the cuts add up to much less.
Released the same day the Treasury Department announced that the government has reached the $14.3 trillion legal limit on its ability to borrow money, the CBO study illustrates the difficulty in cutting the deficit, especially for the immediate future.
Treasury has the ability to juggle the books to avoid a default for now, but legislation to lift the so-called debt limit is going to have to include significantly greater cuts than the spending bill last month.
The budget office also said the compromise negotiated between Boehner and President Barack Obama actually increases the deficit this year by $3.2 billion, because of military spending.
Part of the problem, of course, is that politicians were trying to cut spending while only working with about half of the year’s budget since many programs had already been authorized and funded via the Continuing Resolutions that were passed in late September and December. Nonetheless, this has got to be a bit of an embarrassment for the House GOP.