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Thread: House defeats Republican spending plan

  1. #41
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    Re: House defeats Republican spending plan

    Quote Originally Posted by vvx View Post
    I suppose another way to look at it, since spending cuts aren't the only way to achieve this, what if after 9/11 Bush had demanded tax increases equal to the money spent on the wars?
    then we would be in the same boat that we are in today - as tax rate increases do not produce more revenue.


    's why they call it the "Dismal Science"

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    Re: House defeats Republican spending plan

    Quote Originally Posted by vvx View Post
    I don't see how it does anything for the deficit either way. If the proposed spending is $100, either a cut in spending of $100 or an increase in taxes of $100 will result in $0 net change in the deficit. So what's your point, what's the deficit gotta do with the tax increase?
    not really. generally, a dollar cut from the budget equals minus one dollar to the deficit. a dollar added to GDP equals about 19 cents reduced to the deficit direct, with other, less calculable reductions indirect.

    however, the only way to get an extra dollar in revenue, is to increase GDP by about 5 dollars.

    OR

    if you were just looking at straight revenue reduction, decreasing the size of government by 80 cents (back of the napkin math) would net you about a dollars' worth of deficit reduction.

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    Re: House defeats Republican spending plan

    Quote Originally Posted by cpwill View Post
    Actually, this is fantastic precedence. Otherwise, everything simply has the word "emergency" attached to it, and any pretence at fiscal sanity once again is out the window.
    Quote Originally Posted by Objective Voice
    Moreover, it's never been done before when our nation has been faced with natural disasters.
    Quote Originally Posted by cpwill View Post
    Actually it turns out to have been fairly common. prior to 2002.
    I understand where Rep. Cantor's coming from. However, I also think that when the President AND Congress declares certain parts of the country as "disaster areas", Congress is then obligated to follow the law and appropriate the funding. (See President's request for additional disaster relief funding.) And the law as summarized in post #6 clearly outlines what the protocal is for appropriating funding under emergency/disaster conditions. To that, Rep. Cantor, IMO is playing politics here. But Sen. Reid didn't help matters much by attempting to lump additional disaster relief spending with other legislation, i.e., a CR, coming out of the Senate under the guise of "expediency".

    This article from a local news network out of NY illustrates why the additional funding is needed not just for rebuilding damaged property and city infrastructure but there's also the issue of farmland that's also been devasted by floods not to mention forrestry consumed by Texas wildfires.

    Per this article from MarketNews, it would appear that Sen. Reid will attempt to send a clean CR back to the House via the Senate requesting the initial $3.65 billion the House previously passed basically putting the ball back in Boehner and Cantor's hands. And since Dems won't allow cuts to only come from the DoE/ATVM program, this may force Republicans to seeks offsets from other areas.

    Bottom Line: I think Dems could accept offsets if cuts were coming from multiple agencies, but it's very clear that Rep. Cantor and House Republicans had a specific "target" in mind when they sent their amended bill to the Senate.

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