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Former CBO Director Douglas Holtz-Eakin on potential sequestration cuts, the looming fiscal cliff and Federal Reserve policies.
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After missing last week's deadline and several deadlines before that the White House finally today released details.
On how they will implement one point two trillion dollars in across the board spending cuts over the next ten years.
The White House warning the so called sequestration cuts.
-- have a devastating impact and government programs.
Joining us now it is -- Congressional Budget Office director Douglas Holtz -- The president of the American action forum darn good to have you here.
Your your your reaction and I don't expect you to have done -- with a completed balances of what they White House has delivered but give us your sense of it.
I think if you you look at the most granular level that the report disappoints because what the congress asked for.
Was for the administration to drill down to the level of programs projects and activities will be affected by this sequester and the administration he didn't comply that they civil here's some account numbers will be affected.
And we're gonna have nine point 2% cuts in defense and eight point 4% cuts in non defense -- -- goes so.
I think the congress can be disappointed by that and if you step back a little bit.
This is a report that offers no solution to what they admit is terrible policy across the board cuts.
-- -- indiscriminate with respect or whether programs are working or not.
And instead simply points fingers and I think that reflects the larger problem that we are sailing straight toward the so called fiscal cliff.
And there's a lack of leadership that that won't get us there -- into the spring safely.
There yesterday as Federal Reserve Chairman Ben Bernanke announced quantitative easing idea.
-- the broadest and strongest.
Monetary policy.
Actually I've ever seen taken by -- fed German frankly.
He stood rather alone.
It and and it was remarkable in that there are no partners for the Federal Reserve.
Our this Fed Chairman in Washington DC right now.
He is being criticized from every side meanwhile both Republicans and Democrats it is critically important that everyone understand this.
Democrats and Republicans.
Signed up to one of the it's for most perverse.
Bargains.
I would say and US history.
Yet.
I'm not a big fan of that QE3 is a policy matter but I think your comments -- -- chairman -- dead on he was quite honest about its limited ability to solve our problems.
He has said repeatedly.
That he needs that congress the administration to take action on our fiscal policies.
And if you look at what is actually going to happen in the absence of real legislation.
We're going to raise taxes and slash across the board.
The core functions of government and not undertake the kinds of cuts in mandatory spending entitlement programs that are necessary to solve our problems so.
We have -- policy that is exactly backwards -- -- trying to fix it and the Fed is trying to do something that is unlikely to work out of desperation more than anything else.
And with the labor market as it is 23 million Americans out of work under.
Underemployed or simply haven't given up the idea of working again.
It there is a seeming lack of understanding that this election should be about our middle class and those who aspire to -- And and enough of the nonsense about being agents for government or agents for business.
It is about time that people focused on reality and I'm talking about.
This president and the man who would be president governor -- We need.
Fundamental entitlement reforms that make our social -- -- -- survive to the next generation seniors and low income Americans to make sure doesn't do that.
By spewing red ink and and burdening the next generation of our of younger Americans.
We need a fundamental tax reform.
Not because tax reform as it is fine -- looks good because we need to grow more rapidly to help those people who would be benefited most by actually having a job.
And not anything else and -- we're not hearing an honest conversation about that we don't hear from the president anything about what he would do with another term in office.
And with mr.
Romney we're getting lost in the details and of exemption name vs deduction be let's let's look of -- larger goals.
And I I would suggest and submit that bench focus should be area.
On our middle class the people -- make this country work and every everywhere.
Absolutely but it's always a question about that very gonna -- -- review again.
