Via The Daily Beast, the Wall Street Journal reports that the Obama administration is recommending a two year pay freeze for federal workers as the president’s opening gambit in debt reduction negotiations with Congress.
Of course, pay freezes and budget cuts in various executive departments will be part of what needs to be done, but the $29 billion the proposal will save barely scratches the surface of the debt it is designed to counter. Further, that cut comes in the face of a fiscal year 2011 budget proposal that already includes $1.5 trillion in additional deficit spending.
Let’s face it: even with a 10 percent reduction in the entire budget, the federal government still proposes to spend $1.1 trillion more than it will take in from tax revenue. Even if the the Bush tax cuts had never been put into place, the Obama administration spent or proposes spending $3 trillion more than even the most optimistic tax revenue assessments speculate the nation could have paid ($4 trillion with the tax cuts).
The bottom line is that, even with higher taxes and lower spending, the United States can no longer afford its own federal government right now, and that fact does not even consider the looming crises of Fannie Mae/Freddie Mac, Medicare, and Social Security. Unless we take drastic (cutting whole departments: Education, I’m looking at you) and meaningful (privatizing or eliminating future Social Security and Medicare) steps now, our nation is headed for a catastrophe of historical proportions.