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


SPY197.54  chart-0.36  chart -0.18%
GOOG576.36  chart-0.74  chart -0.13%
AAPL100.11  chart-0.64  chart -0.64%
TSLA245.26  chart-1.34  chart -0.54%
BBRY10.23  chart-0.03  chart -0.29%
NFLX449.56  chart+0.81  chart +0.18%
FB79.00  chart+0.21  chart +0.27%

Nikkei16154.83  chart-155.81  chart -0.96%
Shanghai2361.26  chart+3.549  chart +0.15%
UK6646.60  chart-2.79  chart -0.04%
France4358.07  chart-36.68  chart -0.84%
Germany9422.91  chart-67.64  chart -0.72%