*Written by Shikha Dalmia.
Threatening public services while corporate fat cats sit on taxpayer money is offensive.
President Obama has been jetting around the country, warning of untold pain and suffering starting today when the sequester budget cuts kick in. But if he really buys his own gloom and doom, there is a way he can avoid major cuts for the rest of the fiscal year: Recall the outstanding Troubled Asset Relief Program, or TARP, bailout money that General Motors and his Wall Street pals are still sitting on.
The sequester deal, as Bob Woodward has reminded us, was proposed by the president 18 months ago to persuade congressional fiscal hawks to raise the debt ceiling. Meanwhile, Congress had an opportunity to find alternatives to the automatic, across-the-board cuts (or sequester), but it failed.
America’s annual trillion-plus deficit is almost equal to the entire 1985 federal budget. Its cumulative national debt is $16.5 trillion—more than the nation’s GDP. That’s not counting the nation’s unfunded Social Security and Medicare liabilities. Count those, and the debt adds up to $80 trillion—about eight times the GDP.
The $44 billion in sequester cuts for this fiscal year amount to what the government borrows every two weeks. (The sequester actually requires about $85 billion in cuts this year, but about half can be rolled into subsequent years.) This is chump change that any fiscally responsible president could shake out of his back pocket. Indeed, a 2011 Government Accountability Office report identified about $100 billion worth of government waste and duplication that could be eliminated without affecting anyone outside Uncle Sam’s employ. But instead of doing the responsible thing, President Obama has taken to the stump and made the sequester a social justice issue.
CONTINUED at Reason.