From trillions to billions … those vanishing spending cuts

Punch line: The $1 Trillion (with a T) in spending cuts in the debt deal includes $7 Billion (with a B) in 2012 and $3 Billion (with a B)  in 2013.

I guess the program catches steam in 2014.

Yeah, right.

Talk about back-loading … and illusion.

According to the AP

The first phase of cuts would reduce spending by $917 billion over 10 years. A congressional committee would decide on a second phase of cuts totaling $1.5 trillion.

The first phase of a deal to raise the government’s borrowing limit would pose little threat to the economy in the short term because almost none of the spending cuts would occur before 2014.

Discretionary spending, which excludes Social Security, Medicare and Medicaid, would be cut by only $7 billion in 2012 and $3 billion in 2013, according a summary by Senate Democrats.

That’s a tiny fraction of the nation’s $14 trillion economy.

“That’s certainly inconsequential for the economy.”

As Gomer Pyle would say: “Surprise, surprise, surprise”.

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