President Obama today claimed his latest solution to the fiscal cliff is a “balanced” approach with $1.2 trillion in spending cuts and $1.2 trillion in new tax revenue – unfortunately, it’s just not true.
The president’s plan demands more revenue than he claims … The president’s latest offer conveniently fails to include the additional revenue gained from the CPI change in its $1.2 revenue claim, thus actually making his offer $1.3 trillion – a revenue number that is significantly too high. (Sneakily, the White House does include the spending reductions from the CPI change in its $1.2 spending cuts claim)
And it cuts far less than he claims … The president’s plan counts interest savings as spending cuts, but interest savings from higher tax revenue is not a spending cut. Republicans have proposed a truly balanced approach that includes programmatic spending cuts equivalent to any revenue increases. The lofty claim of $1.2 trillion in spending cuts actually falls to just $930 billion when you back out the interest savings, and just $850 billion when the president’s new “stimulus” proposals for unemployment insurance and infrastructure are taken into account. (Don’t you wish the White House would work as hard to actually cut spending as they do trying look like they are?)
Thus the president’s offer of $1.3 trillion in revenue and $850 billion in spending cuts fails to meet the test of balance he himself has promised.
While the White House slow-walks us to the edge of the cliff, Republicans are moving ahead on legislation that Americans for Tax Reform says “permanently prevents a tax increase on families making less than $1 million per year.” The nonpartisan Joint Committee on Taxation (JCT) confirms it is a $3.9 trillion tax cut. Learn more about it here.