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Ryding: Let the Spending Cuts Kick In

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    RDQ Economics chief economist John Ryding weighs in on the debate over spending cuts.

  • Duration 3:04
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This hour just over a week until the nearly 85 billion dollars an automatic spending cuts case -- but our next guest says.

And let it happen.

Joining us now is John -- chief economist.

-- RDQ economic John good to see you first is really only if you look at this year about 44 million dollars not even that much that's correct -- One of the problem with spending cuts is there announced cuts in budgetary authority and some of that may be for future years may never be intending to spend.

The actual cuts and -- cuts from a growing -- -- he's 45.

Billion dollars this year.

And we got a fifteen point eight trillion dollar economy is gonna put him in perspective each one quarter percent and decides what overall economy.

Did these need to happen though as kind of a baseline -- a beginning.

A future spending cuts that if.

We let these happened and realized that they are hard on the economy then then that could open the door for something more serious well I think some but he also need to happen with the basic credibility -- I hate this concept to you about about banking spending cuts.

Because spending cuts are counted over ten years and haven't yet happen.

Not -- clumsy cuts -- -- would be certainly nice to have them replaced by more targeted cuts.

But -- better attach we have some cuts really in the bank that is to say taking place as opposed to.

Cuts or protect them to be an analogy it's like -- I'm going to go on a diet.

But I'm gonna lead to the big dessert right now and -- be paid for by the collars on many take out my diet next year we know what happens that.

I hate the calories now and they never get around to diets in late to rise and we get fat and in terms of credibility.

Do you believe that the markets and investors -- still willing to lend money to the US and -- debt that they need to see movement.

In order to feel secure about.

Not just buying that -- debt is continuing to own it at this point.

-- to be satisfied that we will try and least begin to right ourselves financially well I don't we have a debt crisis at.

This point in time but the problem is.

Then the real things we need to address the things that drives the -- up.

Five years down the road -- of the budget dynamics right now if we have some spending cuts -- too bad the economy is improving.

Deficit may well fall a little bit over the next.

Two -- three years but then we have the longer term problems that Social Security Medicare and the other health related programs so credible cuts for the market.

Would address the growth in those spending programs not something that the sequestered to speak to.

And it's something that the president who I think is demonizing these spending cuts to get.

Revenue increases on the technical tax well tax hikes.

And I think that that's the reason we're we're hearing these played out in in my opinion.

They're not such a big deal but being nice to have the -- -- after -- the federal budgets three and a half trillion -- -- we're talking a very.

Very small piece of the federal budget here China's trade same thank amazing insight as always to welcome back anytime I'm asking you -- sir John -- -- well.

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