Fmr. Obama Adviser: Spending Cuts Needed for Deficit Reduction

Charlotte
The former top economic adviser to President Barack Obama says spending cuts ought to be a part of deficit reduction, even though the 2012 Democratic platform explicitly states that tax hikes, and not spending cuts, should be the path forward on closing the budget deficit.

“I think a balanced plan is important,” said Austan Goolsbee in a brief interview Wednesday afternoon. Goolsbee, who was chairman of Obama's Council of Economic Advisers from 2009 to 2011, added that Obama believes in a “three to one” ratio of spending cuts to tax increases as outlined in the Bowles-Simpson deficit reduction commission's proposal.

But Obama’s party’s platform reads differently. Here’s the relevant passages, as reported by Talking Points Memo:

“We support allowing the Bush tax cuts for the wealthiest to expire and closing loopholes and deductions for the largest corporations and the highest-earning taxpayers,” the platform reads. “We are committed to reforming our tax code so that it is fairer and simpler, creating a tax code that lives up to the Buffett Rule so no millionaire pays a smaller share of his or her income in taxes than middle class families do.”

The corollary to this message: no more spending cuts.

“President Obama has already signed into law $2 trillion in spending reductions as part of a balanced plan to reduce our deficits by over $4 trillion over the next decade,” the platform adds, referring to the multiple rounds of spending cuts President Obama enacted in 2011.

Goolsbee stressed that he was “just a policy guy” and would not comment on whether the party's speakers should be stressing deficit reduction at this week's convention. Asked if Obama should embrace the Bowles-Simpson commission's recommendations in his convention speech, Goolsbee said the president has already embraced the "central tenets" of the plan in his budget.