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What is Needed to Rein in the Deficit?

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    Former CBO Director Douglas Holtz-Eakin on efforts to reduce the government’s rising deficit.

  • Duration 5:18
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The federal budget deficit expected to show short term improvement this year according to the Congressional Budget Office.

Declining to 845.

Billion dollars.

From one point one trillion dollars -- annual deficits expected to go as -- as.

430 billion by 2015 before been soaring to almost a trillion dollars by 20/20 three.

Joining us out of assess all of -- his former director of the Congressional Budget Office and president of the American action forum Douglas Holtz eakins.

Let me start with the president today.

Are insisting that he have.

Well new revenue.

I've just so that the congressman have the privilege of as somehow saving him from himself.

And pushing back the impact of -- sequester that is White House author I'd does it get any more curious than that.

It just -- we -- -- budget netherworld I mean that the numbers today are.

Nothing short of horrific time -- seven trillion dollars in deficits over the next ten years.

This coming after we've raised 600 billion dollars in taxes and what does the president saying he says while.

Let's not do this spending cuts would share were counting on to keep it down to seven trillion dollars deficits and said raise some taxes would have already proven don't solve the problems so.

He got to have a pretty good sense -- humor to look at that seriously.

And to work out of you've got to have a pretty good sense if you were to put this in sort of context with a history of of this president and fiscal issues.

They as a put forward the budget.

The senate -- -- -- one.

And the president -- states said this back in 2011 and November -- first of 2011.

Already he says some in congress are trying.

-- on -- these automatic spending cuts much like he'd did today at 1:15 eastern time.

Why message to them back and 2011.

Know I will veto any effort to get rid of those automatic -- cuts to domestic and defense spending.

Said the brave president.

That that point your reaction.

Well I mean that was President Obama circa 2011.

Candidate Obama in a debate said.

That this question is just not gonna happen didn't explain now president Obama's circa 2013 says well.

It shouldn't happen for a couple of months let's buy some time and day pointing at the Capitol Hill need to pass a bill to solve it.

No particular solution.

Let's remember that this is all -- tempest in a teapot the big picture that came out today was one where the CBO said.

We have bad news on growth 2013 is going to be weak unemployment is going to be high.

And significantly then marched down the long term prospects for the United States pretty significantly.

We're not gonna grow a decade from now very fast.

You can't fix these problems without robust growth -- -- really troubling statement the second was that.

The good news the fact that the deficits getting smaller as the economy recovers.

Is really bad mr.

it's coming so slowly.

And we've solved not a long term problems so.

But we're playing with you know ten millionaire five billion here and we've -- Debt larger than the economy it's gonna stay that way for decades.

And it.

Until everyone understands that they're asked to be.

A prudent rational fiscal policy pursued by both parties.

We are.

On the on the verge it seems to me of being a debtor nation in perpetuity.

And it when you talk about growth the only way to.

Through at least -- deal with the problems it faces now is to restore growth and if you set.

The big issue is growth.

One point 4% this year and then I think some of the most optimistic projections I've ever seen from -- from -- you.

From a president whose economy is contracting at least at the time he made the projection 3.4 percent next year three point 6%.

From twelve to fifteen through 2018.

Are you kidding me.

It's it's just not going to happen in these circumstances and I think one of the great -- that's being pushed -- the American people is that.

We have to choose between growth.

And fixing our budget.

We don't fixing the budget is part of better growth -- it is simply not a good growth policy the -- straight toward fiscal disaster and that's what we're heading for right now.

It would be well advised to to do you turn on the budget.

And I'm with you Lou we need -- sensible rational bipartisan.

Fiscal policy and right now.

We have -- house the passes but it's a senate that doesn't a president who rarely even engages and we have so we don't have a plan we have outcomes and they usually that it.

And frankly the efforts being made by either party when it comes to restoring growth in this economy deal with.

The the fiscal issues that debt issues the deficit issues I mean these are woefully -- Inadequate and I think.

In articulate.

Advocates -- -- White House or whether it be from Capitol Hill.

Hopes that Douglas Holtz Aiken is always articulate.

And we appreciate your being here as well thanks -- bringing Russian out of insight as well.

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