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When Republicans took control of the House in January, they pledged to make deep cuts in federal spending, and in April they succeeded in passing a bill advertised as cutting $38 billion from fiscal 2011's budget. Then in August, they pushed for a deal to cut an additional $2.4 trillion over the next decade.
Some analysts have blamed these spending cuts for this year's economic slowdown.
But data released by the Treasury Department on Friday show that, so far, there haven't been any spending cuts at all.
Higher Spending, Deficits
In fact, in the first nine months of this year, federal spending was $120 billion higher than in the same period in 2010, the data show. That's an increase of almost 5%. And deficits during this time were $23.5 billion higher.
These spending hikes haven't stopped many analysts from claiming that the country is in an age of budget austerity, one that's hurting economic growth.
A July article in USA Today, for example, claimed that "Already in 2011, softer government spending has sapped growth."
Jared Bernstein, former chief economic adviser to Vice President Biden, wrote over the summer that "government spending cutbacks have been a large drag on growth in recent quarters and have led to sharp losses in state and local employment."
Economist and New York Times columnist Paul Krugman argued in September that "the turn toward austerity (is) a major factor in our growth slowdown."
If government spending is related to growth, as these and others claim, then the economy presumably should be growing faster, not slower, given the current higher rates of federal outlays.
State Spending Higher Too
Nor does the claim that state governments sharply cut spending stand up well to closer scrutiny.
Overall state spending continued to climb right through the recession, when all money from state general funds and other funds, federal grants and state bonds is combined.
Total state outlays in 2010 were almost 10% higher than in 2008, according to the National Association of State Budget Officers' annual State Expenditure Report.
And general fund spending — which makes up about 40% of total state spending — is expected to climb 5.2% in 2011 and 2.6% next year, according to the association's latest survey.
NASBO says that states were able to sustain spending growth through 2010 only because the federal government was pumping more money in via the $830 billion stimulus, and that these funds are now all but exhausted.
Ron Paul has now walked the budget-cutting walk he's been talking about.
The Republican presidential candidate released a federal budget that cuts $1,000,000,000,000 in spending, kills off five cabinet-level departments, chops the federal workforce by 10% and guts his own presidential pay by ...
Half of all Americans — as in 50% — now believe that marijuana should be legalized.
Less than half — 46% — are opposed.
This is a record high approval for approving marijuana's legalization and an amazing quadrupling of support from 12% from the first time ...
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It was in the morning, but Herman Cain got some prime-time before the American people this weekend to explain his 9-9-9 tax plan — and much more.
Under questioning from David Gregory of NBC's Meet the Press, Cain admitted that some people would pay more taxes under his plan but said it ...
Pizza boss Herman Cain, who's parlayed three 9's into a winning hand for now among the eight competing Republican presidential candidates, makes the big-time this Sunday.
He's headlining Meet the Press where he'll get the full MTP treatment from David Gregory. Maybe DG will be able to get ...
Posted By: Mikey B(5) on 10/17/2011 | 11:56 PM ET
John, what is so hard to understand? They cut spending below what it would have been if left on auto pilot. It was probably supposed to go up by 10% so a 5% growth is a big cut! Now you know why this is such a hopeless cause. Before any real progress is made all the current politicians will have to be replaced.
Posted By: Buzz Belleville(20) on 10/17/2011 | 9:57 PM ET
How much of the increase is non-military discretionary spending vs. how much is mandatory social safety net or entitlements? To say the gross amount of spending went up doesn't mean much.
Posted By: tracisargent(5) on 10/17/2011 | 9:41 PM ET
My best friend's mom makes $77 an hour on the computer. She has been out of job for 9 months but last month her check was $7487 just working on the computer for a few hours. Read about it here NuttyRich.com
Posted By: conservative001(5) on 10/17/2011 | 6:22 PM ET
It amazes me that this kind of information is never presented by the Republicans. Certainly the liberal media will never cover it, but why doesn't FOX News.
Posted By: Brownknows(4510) on 10/17/2011 | 5:00 PM ET
Unless the spend-aholics overdose like a Winehouse or Jackson, spending will not go down, the addiction will be fed. We need an intervention on Nov 6, 2012 and slay the beast. Those sent to slay the beast best succeed or America goes the way of Joplin and Hendrix. Live free or die.
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