Politics/Economics: Why We Can’t Cut Spending

This Forbes article did a pretty good job of explaining in simple terms and numbers why we can’t balance the budget just by cutting spending. The gist is that there really isn’t that much money in services which can be cut (to balance the budget we’d have to cut nearly ALL of it) because services are really a very small portion of the federal budget.  Along with the minuscule impacts of cutting services on the budget, there’s little political will for doing so.

Another interesting point that puts simply what I didn’t hear in the news during the debate over stimulus v. tax cuts is spelled out:

Revenues would be even lower if Republicans had gotten their wish and the stimulus consisted entirely of tax cuts. How tax cuts would help people with no wages because they have no jobs or businesses with no profits to tax was never explained.

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