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Archive for Thursday, May 19, 2011

Student loans, pensions eyed for budget cuts

May 19, 2011

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— The White House and key lawmakers are considering reductions in student loan subsidies, farm payments and support for federal workers’ pensions as they search for cuts that can clear the way for an increase in the national debt limit, according to officials in both parties.

The negotiations are still in the early stages, with no final decisions made, these officials said Wednesday. While the amounts involved so far are relatively modest, the talks led by Vice President Joe Biden appear likely to assume greater public prominence with the evident collapse of a freelance attempt by the “Gang of Six” senators to produce a sweeping bipartisan plan to reduce red ink.

“We’re talking (about cuts totaling) $200 billion, $150 billion and we have to get up into the trillion range or more,” said Sen. Jon Kyl, R-Ariz., one of six other lawmakers taking part in the talks at Blair House across the street from the White House.

“We have a long way to go if we’re struggling at this level with this amount,” he said, adding that so far, the talks have generally focused on areas of agreement.

The group has yet to discuss military spending or deeper reductions in programs that already were trimmed in legislation that narrowly averted a partial government shutdown in April.

Any discussion about savings from Social Security, Medicare and possibly Medicaid is likely to be set aside for President Barack Obama and Speaker John Boehner, R-Ohio, to handle.

Treasury Secretary Tim Geithner has said Congress must raise the $14.3 trillion debt limit by Aug. 2 or risk a first-ever government default. Republican leaders, acknowledging the need for new borrowing authority, want cuts of at least the same magnitude as any increases as a way to gain control over future spending.

Some of the cuts under review were first advanced by the administration, and others were included in a budget that Republicans passed in the House last month.

Negotiators are also looking to recommendations made by the National Commission on Fiscal Responsibility and Reform, appointed by Obama and headed by Erskine Bowles and former Sen. Alan Simpson. A separate plan produced by the highly regarded Bipartisan Policy Center also figures in the talks.

Comments

just_another_bozo_on_this_bus 3 years, 6 months ago

The rich say we're broke, so the poor and the working and middle classes must pay.

texburgh 3 years, 6 months ago

One simple budget cut to get out of the whole mess. Get out of Iraq and Afghanistan. That way we can preserve hope for young people through college loans and grants and protect social security for seniors.

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