A Way Out Of the Budget Impasse

By Jul 13, 2011, 12:44 PM Author's Blog  

In a column posted today on Bloomberg Views I suggested a way to resolve the budget impasse. It starts with the fact that about $6 trillion in deficit reduction is needed over 10 years to get to balanced budget.The proposal is that the President and the Congress agree now to $2.5 trillion spending growth reductions and increase the debt limit by the same amount. The question about how to close the remaining $3.5 trillion gap–tax increases or more spending reductions–is then left to debate next year as part of the 2012 election.

This chart–which I have used before–shows the feasibility of the idea. In a speech on April 13 President Obama already suggested about $2 trillion in spending growth reductions. So we are almost there.

A Way Out Of the Budget Impasse

  • SHARE:
  • Share on StockTwits

One Comment

  1. blue magic says:

    obama doesn’t realize that any dept. ceiling increase regardless how large will be short term. america is burnin through so much cash so fast that u can’t really can’t print or borrow it fast enough.treasury will burn through 2-3 trillion in a year maybe two


SPY193.615  chart+3.315  chart +1.74%
GOOG523.50  chart+2.66  chart +0.51%
AAPL102.245  chart+2.485  chart +2.49%
TSLA233.44  chart+2.97  chart +1.29%
BBRY10.12  chart-0.18  chart -1.75%
NFLX365.53  chart+6.31  chart +1.76%
FB78.57  chart+1.62  chart +2.11%

Nikkei14804.28  chart-306.95  chart -2.03%
Shanghai0.00  chartN/A  chartN/A
UK6372.33  chart+105.26  chart +1.68%
France4081.24  chart+90.00  chart +2.25%
Germany8886.96  chart+169.20  chart +1.94%