Debt Ceiling Plan to Cut Only $1.7 Trillion When Adjusted for Inflation

Patrick Tyrrell /

The Congressional Budget Office (CBO) announced yesterday that the Budget Control Act of 2011 would lead to $2.1 trillion in deficit reductions. But the CBO’s letter to congressional leaders is somewhat misleading.

Table 3 of the document shows how much in discretionary and mandatory deficit reduction the CBO estimates would be produced by the legislation from fiscal years 2012 through 2021. They found about $918 billion cuts. The remaining $1.2 trillion in cuts is not predicted by year, because, as CBO notes, “The composition of the other $1.2 trillion in savings over time and across budget categories would depend on the specific provisions of any legislation stemming from proposals of the joint select committee and the extent of any automatic reductions that would be triggered.” (more…)