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Where Will The Spending Cuts Be Made?

by Hugh McQuaid | Oct 16, 2012 4:30pm
(21) Comments | Commenting has expired
Posted to: Congress, Election 2012

Hugh McQuaid file photos

Chris Murphy and Linda McMahon

Seeking to corner U.S. Senate candidate Linda McMahon on what she would cut from the federal budget, Chris Murphy suggested she would cut benefits for veterans in order to fund her tax cuts. Not true, says the McMahon campaign.

Murphy, a Democratic Congressman, is in a tight race against McMahon, a Republican former wrestling CEO, for the seat being vacated by retiring U.S. Sen. Joe Lieberman.

McMahon’s six-point jobs plan recommends reducing federal spending by 1 percent each year, as well as cutting the middle class tax rate from 25 percent to 15 percent and extending the Bush-era tax cuts for everyone. Her plan does not recommend cutting services for veterans. In fact, it contains a provision aimed at helping employers understand the value of employing veterans.

But Murphy has taken to focusing on the unknowns in McMahon’s plan, specifically what she would cut. McMahon points to a Government Accountability Office report that her campaign says identifies $217 billion in overlapping programs. McMahon’s campaign says the report outlines 47 separate job training programs, 88 economic development programs, 82 teacher quality programs, and 56 financial literacy programs, and that she would cut $38.6 billion a year out of those programs over the next 10 years.

Todd Abrajano, McMahon’s spokesman, said Monday that most taxpayers would be upset to learn of the amount of duplicative spending in government.

“Why are we spending money to do things 30 to 40 times when we could just do it once?” he asked.

However, University of Connecticut Economist Fred Carstensen said in August that there is likely fat to trim in the federal government, but it’s likely harder to cut than they realize, because cuts always impact someone.

At a campaign event in Middletown today, Murphy said McMahon has got to get specific on just which of those programs would go, or veterans benefits would need to be on the table.

“Linda McMahon’s economic plan is a choose-your-own adventure novel because every day there’s something new to it. But let’s be honest if you want to balance the budget and give a new $4 trillion tax cut, you have to cut things like veterans’ funding,” Murphy said, adding, “I’m sure you’re going to call her and she’s going to say, ‘Oh no, I wouldn’t cut veterans funding,’ but at some point she has to tell us what she’s going to cut.”

Abrajano pointed to a recent campaign event at a Danbury veterans hall, where U.S. Sen. John McCain endorsed McMahon. McMahon stated there that veterans benefits need to be protected since veterans “risked their lives and limbs” for the country.

“I mean everything [Murphy] says is ridiculous,” Abrajano said. “. . . The bottom line is Linda McMahon will not cut benefits for veterans.”

Murphy said it could be added to the growing list of things she has said she wouldn’t cut. McMahon has stated that she would not make cuts to defense spending, entitlement programs, and food stamps, he said.

“At some point, you know, Linda McMahon’s numbers have to explode in her face. There’s no way to give a $4 trillion tax cut and not start cutting programs like veterans,” Murphy said.

Abrajano said that even with the things McMahon has taken off the table for spending reductions, there’s still an enormous amount of spending to cut.

“There’s hundreds of billions of dollars that could be reduced because there’s so much overlap,” he said.

During their first debate Murphy accused McMahon of habitually avoiding specifics. After she answered a question regarding how she would shore up the Social Security program, he said she’d offered “a minute and 30 seconds of ‘I’m not going to tell you what I’d do.’”

But during that debate Murphy also agreed to cut 1 percent from the federal government’s discretionary spending, though the campaign has not been clear about exactly how much of the budget is considered “discretionary.” On Monday, Murphy accepted the support of Veterans and Military Families for Progress and pledged to keep fighting for veterans services. But it’s not clear exactly how Murphy would arrive at a 1 percent cut either.

During the first televised debate Murphy did give some examples of federal spending he feels we could do without.

“I’ve opposed duplicative programs at the Department of Defense that would build engine programs that we don’t need, costing the government $3 billion. I’ve opposed subsidies for agri-businesses in the Midwest that cost this government over $8 billion a year that we don’t need. I’ve opposed giving away tax breaks to the oil industry and the defense industry to outsourcers that they simply don’t need. So I’ve been very willing to stand up and oppose wasteful spending,” Murphy said. “But I do believe we need a combination of both additional revenue to the federal government from those who have done very well in this economy and some serious spending cuts.”

What Murphy didn’t say was that the cuts he rattled off amount to less than 1 percent of the federal budget and Connecticut whether benefits from, or is not impacted in any way by, things such as subsidies for agri-business in the Midwest.

A proposal to eliminate $2 billion in subsidies to the five biggest oil companies failed twice in the Senate, and Congress has largely ignored President Barack Obama’s call to eliminate about $4 billion in oil subsidies.

Obama’s budget allocates about $3.552 trillion in spending. Murphy’s specifics on things he’d be willing to cut during the debate fall far short of one percent.

On Tuesday his campaign emailed a list of more spending reductions Murphy supports. Ben Marter, his spokesman, said it wasn’t an exhaustive list. Marter said Murphy’s support of bringing home American troops from Afghanistan would save around $2.2 billion a week. Most of the rest of the list involves closing various tax loopholes. For instance, Murphy supports ending:

- A provision that allows corporate jet owners to write off their planes two years earlier than airliners, saving around $2.2 billion over 10 years;

- A tax rebate for rum available in Puerto Rico and the Virgin Islands, saving around $100 million a year;

- A loophole used by Miami-based Carnival Cruise Lines, which also is incorporated in Panama and avoids paying some taxes by treating revenue as foreign sourced;

- A tax deduction for corporate meals and entertainment costs, saving around $10 billion a year;

- A tax deduction for corporations allowing them to deduct punitive damage awards, saving $319 million over a decade;

- Various tax breaks for timber companies that would total $1.6 billion over 5 years, and;

- Subsidies to coal companies, totalling $2.6 billion over 10 years.

Asked for examples of what McMahon would cut, Abrajano declined to specify.

Vincent Moscardelli, a political science professor at the University of Connecticut, said McMahon’s reluctance to comment on specific programmatic cuts likely stems from a desire to pick up independent and Democratic voters.

“As a Republican running in Connecticut, Linda McMahon faces an uphill battle,” Moscardelli said. “The programs that in all likelihood she would target would be programs near and dear to Democratic constituencies. As a candidate who needs crossover votes to win, she has nothing to gain from antagonizing Democrats still on the fence.”

Moscardelli said there’s some historical precedence for waiting until after the election to flesh out the details of a plan. In 1994, Newt Gingrich and other Republicans successfully made the ideological argument for smaller government and waited until after November to describe what that would look like, he said.

If there’s enough anxiety about a perception of out-of-control government spending among voters, a general call for cutting spending can be effective, Moscardelli said.

“The problem is the devil is in the details, which is why Chris Murphy will keep trying to force her hand,” Moscardelli said.

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(21) Comments

posted by: AndersonScooper | October 16, 2012  5:01pm

Balanced budgets anyone? Not Linda!

Fwiw, McMahon has never been real good at matching inflows to outflows! Note below how WWE’s dividend payouts have exceeded earnings for the last three years:

2011 WWE earnings: $.35/share
2011 WWE dividends: $.72/share

2010 WWE earnings: $.71/share
2010 WWE dividends: $1.44/share

2009 WWE earnings: $.68/share
2009 WWE dividends: $1.44/share

Of course this is unsustainable in the long run….

posted by: Noteworthy | October 16, 2012  8:53pm

If you can harvest growth in the economy, you have to cut less. But the bottom line is that Murphy’s numbers explode in his face and maybe Linda’s too but she’s not the one making the allegation. Moreover, at this late date in the campaign, this is Murphy’s first list of things he would change - and nearly none of them have much of a chance of being enacted. What are Murphy’s thoughts on the Simpson Bowles cuts? On Social Security? Medicare? The entitlements! Go take a ride on your foreign sub.

posted by: MGKW | October 17, 2012  8:19am

Wow! Linda and Romney’s math boil down to two words…trust me…nope, I can’t not with your history of trying to be something that you are not!

posted by: ConnVoter | October 17, 2012  9:02am

Ed, it’s WWE’s money, not yours.  Unless you own stock in the WWE, what do you care?

Anyway, do you agree that spending more than you take in is “of course… unsustainable in the long run”?  You know that the President is spending more than twice as much money as we’ve ever taken in before—ever—in U.S. history, right?  Maybe you should bring this up at your next Hope and Change advisors’ meeting.

posted by: AndersonScooper | October 17, 2012  1:48pm

@ConnVoter—

Yes, and Linda thinks the answer is more tax cuts?

Phenomenonaly irresponsible!

posted by: ConnVoter | October 17, 2012  3:44pm

Ed, as you hopefully learned after the Bush tax cuts, we increased our tax revenue.  What Linda is proposing won’t lead to a reduction in tax revenue.  What the President is proposing will.  It’s pretty simple, actually.  If you do something that succeeds, don’t do the opposite and expect success.

posted by: SalRomano | October 17, 2012  4:35pm

AndersonScooper: You should be an expert on “irresponibility”—if you are a supporter of a fiscally irresponsible Chris Murphy—only because he is a Democrat. Try thinking about your country—instead of suporting a political failure… by voting for America—in Linda McMahon. You stick with Democratic losers that have been sinking America to oblivion. At least Linda McMahon has earned her money—while Chris Murphy has been “stealing a week’s pay” from our deficit taxpayer money for the past six years.  It’s too bad you stick with Democratic politicians who keep burying the USA, but you will never change for the better, Anderson Scooper.  Start learning Chinese, Scoop, as long as you want people like Obama-Murphy to keep burying us.

posted by: stellathecat | October 17, 2012  5:02pm

If the Bush policys worked what was that mess Obama inherited?

posted by: AndersonScooper | October 17, 2012  6:04pm

@ConnVoter—

Nothing more ridiculous than arguing with a ardent supply-sider.

Riddle me a couple of things, if you would:

1. If tax cuts produce surpluses, why haven’t they? (In this low-tax environment, at least the lowest federal taxes since 1950.)

2. Why not just lower income taxes down to zero, if that is the real means of increasing revenues?

The scary thing is that people like you honestly believe the B.S. you’ve been served. I look forward to your informed responses.

posted by: NoNonsense2012 | October 17, 2012  8:59pm

Look, folks, as far as Romney’s and McMahon’s plans are concerned, it’s a “need to know” basis. And they don’t think we need to know. End of story.

posted by: ConnVoter | October 18, 2012  8:10am

Ed, despite your mental deficiencies, I’ll bite.  You asked, “if tax cuts produce surpluses…”  Right off the bat, that’s a non-starter.  Surpluses and deficits are defined by tax revenue versus spending.  If spending exceeds revenue, that’s a deficit.  If revenue exceeds spending, that’s a surplus.

From 2003 through 2008, tax revenue skyrocketed, but so did spending (on things like homeland security, wars and pork).  That’s why deficits grew:  spending was far ahead of revenue EVEN THOUGH REVENUE WAS AT RECORD LEVELS.

When the Democrats came to town in 2007, spending continued to throttle higher (as it always does when you put Democrats in charge of something).  Then, in 2009, as rich people got hammered in the recession (their incomes dropped by almost a quarter from 2008 to 2009), tax revenue fell off the table, but DEMOCRATS KEPT SPENDING.

These are all facts.  Look them up.

Next, you asked, “why not just lower income taxes down to zero?”  That’s as stupid of a question as asking, “why not just raise tax rates to 100%?”  Both would bring in NO revenue.  The question should be, “what is the best tax rate to bring in the most revenue?”  Because the Bush tax rates brought in more tax revenue than the Clinton tax rates, we should continue to cut tax rates until tax revenue begins to fall—and we should definitely NOT cut tax rates.

Have you learned anything?  Please visit www.irs.gov if you want to know what the cold, hard facts are on tax revenue.  The bottom line is that we brought in far more money after the Bush tax cuts than before, and raising tax rates right now would be colossally dumb.

posted by: MGKW | October 18, 2012  9:13am

Always depend on Sal to drink that Republican Kool-Aid…btw, view the video below as to how Linda McMahon earns her money…porn, violence against women and general moral depravity…this video is not for the faint of heart—-Mamahon’s lawyers tried to surpress this one—-I can see why..

http://exploded-view.org/wrestling-with-manhood-excerpts-show-the-worst-of-who-we-are/

posted by: MGKW | October 18, 2012  11:03am

Connvoter: Stop getting your facts from Faux News…the expansion of deficit was caused by two wars, Medicare drug and enhancement and tax cuts…the resulting expansion you describe was negated by the crash which caused by guess who…Bush’s policies…you can spin it however you want…the crash of the economy mirrored the crash of 29….unbridled and uncontrolled economic activity gone wild…those are the facts—-look them up…I will forego the personal attacks.

posted by: ConnVoter | October 18, 2012  11:59am

MGKW, did you see this comment from my previous post?

“From 2003 through 2008, tax revenue skyrocketed, but so did spending (on things like homeland security, wars and pork).  That’s why deficits grew:  spending was far ahead of revenue EVEN THOUGH REVENUE WAS AT RECORD LEVELS.”

Even if you didn’t, I don’t disagree with you that wars and spending are expensive.  Where you’re dead wrong is when you suggest that the Bush tax cuts cost us money.  Again, look it up.

As for your assertion that Bush’s policies caused that, I don’t know what to tell you.  If you think that Bush and/or the Republicans were the ones pushing sub-prime mortgages, well, I’ve got some Hope and Change (vintage 2008) to sell you.  The Democrats tripped all over themselves to offer people low-cost mortgages for homes they couldn’t afford and THAT is what caused the financial crisis.  Bush certainly played a role, but if you blame him for the sub-prime mortgages instead of your neighbors, you’re missing a lot.

posted by: 29allie | October 18, 2012  12:50pm

OH MY GOSH!  did any of you watch the debates?  As an independent I know who gets my vote.  McMahon has the brain a size of a pea.  Does she really think anyone would listen to ANYTHING she has to say on the budget.  She really embarrassed her party in the debates.  No wonder she never wanted to talk to the media.

posted by: ramonesfan | October 18, 2012  2:06pm

@29allie

Finally people are beginning to understand that Linda is just as empty-headed as Sarah.  Your comment gives me hope that at least some voters are listening.  Thank you.

posted by: SalRomano | October 18, 2012  2:50pm

MGKW: Linda McMahon earned her money, and got to be a millionaire through hard work in private enterprise, so don’t knock it.  Chris Murphy has been a parasite of U.S. taxpayers for six years—-and steals his pay—by skipping nearly 80% of his sessions. I believe in voting for people who understand work ethic and reflect it.  You keep promoting a Democrat with “no work ethic” that only has a hope of getting elected by hanging on tho Pres. Obama’s coat-tails—as his big-spending rubber stamp. You call this Democratic prosperity—but Obama-Murphy are are team to America’s fiscal disaster, as Obama-Murphy have already exeeded the spending of all previous presidential admininistration’s in our country’s history. Don’t worry about the kool-aid I am drinking—and start worrying about the poor house Obama-Murphy are putting us in. It’s later than you think—you better start worrying about our fiscal survival—and vote for our TOP SHELF Mitt Romney and Linda McMahon! Chris Murphy has NO JOBS PLAN or JOB PERFORMANCE RECORD.  A NO-NO!

posted by: MGKW | October 19, 2012  11:36am

Sal—Nice try….she earned her blood money by marketing sex, violence and demeaning women…which you conveniently leave out of your rant…Romney and McMahon are peddling policies that originally got us into the situation we are in…btw, look at the videos below…they are disgusting and gratuitous, something that you have forgotten.

http://www.exploded-view.org/dave-zirin-smacks-down-linda-mcmahon/


http://www.exploded-view.org/wrestling-with-manhood-excerpts-show-the-worst-of-who-we-are/

posted by: MGKW | October 19, 2012  1:15pm

Connvoter—-

I do know what to tell you….we always think that less regulation is always a good thing but after two economic cycles in the 1920’s and then in the 2000’s that ended with a Great Depression and Recession, you’d think that we would learn, but history is never studied or learned from…both in war and in the economy….the take down of Glass Steagell (courtesy of Phil Gramm) was the biggest mistake we made…ushering in the “anything goes” culture on Wall Street and on Main Street with all sorts of financial instruments (replace with Ponzi schemes) that eventually caused the collapse…. You can blame the mortgage markets and try to rewrite history all you want….jungle capitalism and lack regulation caused violent and vorciferous swings in the economy resulting in wide spread social destruction and it continues.

posted by: Christopher55 | October 19, 2012  8:02pm

Bottom line…Murphy does not show up for work.  time for the guy to find another line of work.

posted by: SalRomano | October 20, 2012  11:24am

Christopher55:  Kudos to you—for not selling out your soul and our counntry for the Democratic Party, and our sinking anchors, Obama and Murphy.  Thank you for malking use of your intelligence.  Go Mitt Romney and Linda McMahon!