The fiscal cliff deal

3 Jan

fiscal-cliff03-sizedLet’s look at the deal cooked up by Congress to stop falling off the fiscal cliff, and let them get out of town.

The deal that was designed to save money actually includes $330 billion in new spending over the next decade, says the Congressional Budget Office.

According to the CBO, the bill contains about $25 billion in new cuts, but those are swamped by the new spending on extended unemployment benefits for the long-term jobless and other new refundable tax credits that President Obama wanted.

Of those cuts, only $2 billion are scheduled to take effect this year.

And some of the cuts Congress is counting are from programs on which CBO never expected the money to be spent anyway — such as cuts to the Consumer Operated and Oriented Plan, which was part of Obama’s health care law.

All told, the bill deepens the deficit by nearly $4 trillion over the next decade, when the new tax cuts and spending are combined.

Nice job.

The bill also delays by two months the automatic spending cuts slated to take effect Wednesday, with a promise to reduce spending in the future to cover for them.

Now that is going to be a fight.

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