That’s an incoming member of the House leadership, Kristi Noem (R-SD), encouraging the tax cut deal, but quickly pivoting to the urgent need to slash spending.
While stopping all the tax hikes would be a good first step, this alone won’t eliminate the job-killing uncertainty hanging over our employers and entrepreneurs. That’s why we need to focus on cutting spending and reducing the size of government.
Some would look at this as ridiculous. After all, Noem just endorsed a tax cut bill which would add $893 billion to the deficit over five years. And she dares to lecture about fiscal conservatism?
But if consistency is not the strong suit of conservatives, it doesn’t mean that it will be met with laughter on either side of the political aisle. This is the gambit that Republicans have worked for a generation – make taxes so low and deficits so burdensome that pressure builds to slash spending. They claim that tax cuts shouldn’t be counted as part of the deficit but that any spending must be offset or eliminated. It doesn’t have to make sense. Because it’s working.
Americans should prepare themselves for spending cuts by Congress next year, the chairmen of the House and Senate’s budget committees said Friday.
Both Sen. Kent Conrad (D-N.D.), the chairman of the Senate Budget Committee, and Rep. Paul Ryan (R-Wis.), the incoming chairman of the House Budget Committee, signaled that they’re preparing budgets that would seek cuts to government spending in order to address the deficit.
Conrad said he’d look to the recommendations by President Obama’s fiscal commission as a “starting point,” and then look to craft a budget that improves on those proposals [...]
“We intend to do lots of spending cuts and lots of spending reforms as soon as we take over in January,” Ryan said. “The debt ceiling, obviously, is going to have to be increased if we’re not going to default, so the question is, what do we get in exchange for that, and what kind of fiscal controls?”
These are the two most important people in Washington in terms of what the next budget will look like and how the fight over the debt ceiling will play out. And both of them are gunning for federal spending across the board.
Someone tell me again how this tax cut deal will find reward in creating a “stimulus” by increasing aggregate demand. It’s completely clear that conservative Republicans (with a good deal of support from budget hawk Democrats) will try to create a crisis with the debt limit vote, and if only moderately successful there will use the fiscal year 2012 budget to cancel out whatever increase in demand comes from the tax cuts. And you have to ask yourself – what cuts will be more harmful? Marginal taxes on the rich, or the elimination of Head Start and TANF and dozens of other programs for the poor?
Bernie Sanders notwithstanding, I don’t see a whole lot of resistance to deficit mania in Washington, even after the deficit-busting tax cuts get passed.