As expected, President Obama’s address last night focused heavily on the deficit. Most points we saw coming:
So tonight, I am proposing that starting this year, we freeze annual domestic spending for the next five years. (Applause.) Now, this would reduce the deficit by more than $400 billion over the next decade, and will bring discretionary spending to the lowest share of our economy since Dwight Eisenhower was President.
This freeze will require painful cuts. Already, we’ve frozen the salaries of hardworking federal employees for the next two years. I’ve proposed cuts to things I care deeply about, like community action programs. The Secretary of Defense has also agreed to cut tens of billions of dollars in spending that he and his generals believe our military can do without. (Applause.)
(For a translation of that last part, on Defense, see Josh Rogin’s post at The Cable.)
More importantly, though, in terms of the budget, the President’s speech contained lines like this:
Now, most of the cuts and savings I’ve proposed only address annual domestic spending, which represents a little more than 12 percent of our budget. To make further progress, we have to stop pretending that cutting this kind of spending alone will be enough. It won’t. (Applause.)
The bipartisan fiscal commission I created last year made this crystal clear. I don’t agree with all their proposals, but they made important progress. And their conclusion is that the only way to tackle our deficit is to cut excessive spending wherever we find it –- in domestic spending, defense spending, health care spending, and spending through tax breaks and loopholes. (Applause.)
Today, the Congressional Budget Office raised its estimate of the budget deficit to $1.5 trillion for this year, on track to beat out the previous record of $1.4 trillion, set in 2009.
House majority leader Eric Cantor, House budget chairman Paul Ryan and others have echoed the president’s insistence that the entire budget be on the table. It has yet to be seen what, if anything, will come of these statements. No doubt, cuts are coming. The question is where.