Cut federal spending by 10pct effective tomorrow, so what would be the big deal?

All federal spending.....

5 Answers

  • 8 years ago
    Favorite Answer

    Your premise is false. It simply is not true.

  • 8 years ago

    Just cutting spending does not help the economy, in fact, it makes it worse. It will be a loss of Federal jobs, private sector jobs with Federal contracts, private sector jobs near Federal installations, and so forth. Also the multiplier factor will cause a loss of money in the economy. Even assuming a low 25% tax rate for the above jobs, there will also be a reduction in Government revenue.

    With the above people out of work, there will be a decrease in overall demand for consumer goods.

    The Conservatives want the cuts, because with enough cuts, (a couple of trillions), it may be possible to reduce tax rates, or eliminate certain taxes such as capital gains. Their theory is when that happens, then private sector jobs will increase to pick up the above jobs that were lost. A lot of fingers have to be crossed for that to happen.

  • Dan B
    Lv 7
    8 years ago

    With the huge numbers the feds spend, 10% doesn't amount to much impact. There is some spending that must be spent by law to keep the government running. Social security must be spent because every worker has been required to pay into the system. The military personnel must be paid. Sure there are areas to cut by 10%. But the impact would net around 2-3% of the TOTAL budget.

    I tried to find a real good comparison of the fed budget vs family budget. Cutting $100,000,000,000 ($100B) by 10% from the fed budget is like cutting your $100,000 family budget by about $100. Not much of an impact. You still have living expenses that can be cut up to a certain point, but that's the end of the cuts.

  • 8 years ago

    In theory, it wouldn't be a big deal, until people found out how those cuts would effect them locally. If a 10% cut of the DoD budget, for example, would result in a local company in some small town not getting a contract and having to close; people in that town would complain because they would be directly impacted.

    Government spending cuts effect people. "Cuts are good - but don't cut what I need".

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  • Anonymous
    8 years ago

    To quote a "leading light" of the left: "HE BETRAYED THIS COUNTRY!!! HE PLAAAAYED ON OUR FEARS!" Algore during the '04 campaign

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