White House: Savings Come Later
(CNSNews.com) – The White House asserted that spending cuts would occur under a deal reached with Republicans, but would not pledge to make them immediate, addressing a key concern of many conservatives who fear a compromise will mean tax hikes without spending cuts.
CNSNews.com asked, “A complaint has been made among conservatives that in the past deals were made $3 for spending cuts for every $1 in tax increases, the spending cuts are always 10 years ahead, five years ahead or somewhere along the line. Would the White House agree to something along the lines of upfront cuts early on?”
White House Press Secretary Jay Carney responded with two points.
“First, when rates rise on the top two percent, a subject much discussed during the campaign, the savings achieved through that will be over 10 years. It’s not collect in the first week or month or even year,” Carney told CNSNews.com. “All of this is a period of over 10 years, both savings from spending cuts and savings from revenue increases.
“Two, the president has signed into law specific spending cuts as part of the Budget Control Act. What we have not seen, as I have said already is any specific proposal from Republicans, at least Republican leaders, about how we achieve specific revenue targets that are needed for a balanced approach,” he said.
In 1982, President Ronald Reagan agreed with congressional Democrats on a plan to cut spending by $3 for every $1 in tax hikes. In 1990, President George H.W. Bush made a similar $2 in cuts for every $1 in tax hike deal with congressional Democrats.
“Each time, the tax hikes were real and the spending cuts never materialized. But now it seems those supporting this commission may have in fact signed off on a 1-1 ratio of real tax hikes and fake spending cuts,” the Americans for Tax Reform website.
House Speaker John Boehner (R-Ohio) criticized President Obama for not offering sufficient spending cuts during a House floor speech on Tuesday.
“Let’s be honest - we’re broke,” Boehner said on the House floor Tuesday. “And the plan that we’ve offered is consistent with the president’s call for a ‘balanced approach.’”
Boehner continued that the two sides are not closer to a deal.
“A lot of people know that the president and I met on Sunday. It was a nice meeting, it was cordial, but we’re still waiting for the White House to identify what spending cuts the president is willing to make as part of the ‘balanced approach’ that he promised the American people.
Carney referenced the fiscal plan that Obama presented to the Super Committee in 2011 for having $240 billion in cuts, listed on pages 17 through 45. However, Boehner and Senate Minority Leader Mitch McConnell (R-Ky.) insisted the cuts were not specific.
Both parties are seeking to avert going over the fiscal cliff, the phrase used to describe the automatic tax hikes and spending cuts that are scheduled to take effect in January.
Obama’s plan would increase taxes by $1.6 trillion and calls for the ability to increase the debt ceiling at will, requiring a two-thirds majority of Congress to stop it. Further, Obama has asked for $50 billion in stimulus spending in the first year, but did not identify spending or entitlement cuts. Boehner presented a counter offer to increase taxes by $800 billion through limiting deductions and loopholes.