Conservatives Urge Spending Cut to Balance Budget

By Christine Hall | July 7, 2008 | 8:28 PM EDT

( - A group of House conservatives has called for budget cuts to prevent the federal government from spending more than it takes in next year.

"Surely a fiscally responsible Congress could find one percent of fat to trim from last year's budget," said Rep. John Shadegg (R-Ariz.), chairman of the House Republican Study Committee.

The Congressional Budget Office (CBO) projection for fiscal year 2003 puts the government in the red by $14 billion, but places a balanced budget still within reach, Shadegg believes.

"The more I look at the numbers, the more I am convinced that if we prioritize our spending and show some restraint, we can and should balance the budget this year," agreed Rep. Pat Toomey (R-Pa.), chairman of the group's budget task force.

"If Congress had stuck to the spending caps we set for the last several years, we would still be discussing what to do with the surplus," Toomey continued. "Instead, we have seen discretionary spending increase at almost three times the rate of inflation. Our budget problem is too much spending!"

President Bush is poised to send Congress a $2 trillion budget that includes an estimated $106 billion deficit, mostly due to an increase in wartime defense spending. That's less than one percent of the Gross Domestic Product.

There are signs that the Bush administration agrees with the study committee. Office of Management and Budget (OMB) Director Mitch Daniels has indicated that spending cuts are in order.

Daniels reportedly pointed to corporate welfare spending, like loans for the Export-Import Bank. Daniels is also reviewing agency budgets, rating programs on their effectiveness with an eye toward cuts.

Steve Moore, president of the free market Club For Growth and budget analyst for the Cato Institute, offered some specific programs that could use some trimming. He mentioned the Departments of Commerce and Energy, the National Endowment for the Arts, the Legal Services Corporation and Amtrak.

Moore is attending the study committee's annual retreat next week as a Cato advisor.

"Last year appropriations were up by 11 percent, so one of the points we've been making is if they would just control spending to the rate of inflation for the next 10 years that we'd be back to these $3 trillion surpluses," said Moore.

"The fiscal responsibility should be redefined as cutting government spending, not cutting tax cuts," said Moore.

"Whether or not there's going to be public support ... for cutting the budget is a lot harder to discern," Moore conceded.

Other groups oppose any effort to cut the federal budget.

"We're not going to have a balanced budget this year or next," said Jim Jaffe, spokesman for the Center on Budget and Policy Priorities. "Given the recession, it probably isn't appropriate this year or next.

"If you have a modest deficit, it's not the end of the world," said Jaffe. "The whole idea is that you run surpluses in really good years ... and honest deficits in bad years."

In any case, said Jaffe, "exercises like this haven't gotten very far in the past."

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