StanCollender'sCapitalGainsandGames Washington, Wall Street and Everything in Between


Posted by Stan Collender

As I explain in my column from today's Roll Call, the one thing I know several hours before the polls wil be open in most states on the east coast: Next year's budget debate is going to be as bad as what it was in 2011 when the phrase "train wreck" was an inadequate description of what was happening.

Next Year’s Budget Debate May Be Total Mess

This column was written a few days before the elections and is being published on Election Day. So rather than talking about the election results before they happen (What a concept!), and instead of continuing what is now my weeks-long rant about the fiscal cliff, I thought it best to focus on something that few other federal budget watchers so far have dared talk about: There will be a big budget debate next year and it’s likely to be very ugly.

Posted by Stan Collender

Here's the question I've been asked most often over the past week: Will the White House include in it's fiscal 2013 budget -- the one it will send to Congress in February -- the cuts it will make in military and domestic spending under the assumption the sequester will go into effect on January 2, 2013 as it's currently scheduled to do?

There's no way to know for sure, but my strong suspicion is that the White House will do no such thing.

The president's 2013 budget will include a plan that the White House will say, if it's enacted, will eliminate the need for the sequester. The February budget won't specify what will be cut if the sequester occurs except in the most macro terms.

The reason is that going into the election the White House will want to keep the focus on how the the president prefers to reduce the deficit rather than on how he will implement the changes imposed on him by the sequester if he's reelected (Remember: the sequester will happen two months after the election). That prevents those possible cuts from becoming an election issue.

Posted by Stan Collender

Over at his own blog, Tim Duy provided an interesting post about what we should expect fiscal policy-wise in 2013.

Tim said he saw two possibilities -- fiscal austerity or abandon fiscal austerity -- and he that he'd "like to hear the views of the gang at Capital Games and Gains." Since he quoted one of my posts from several weeks ago and mentioned me by name earlier in the piece, I will take up the challenge for my co-bloggers-in-crime at CG&G while still encouraging them to respond on their own if they're so inclined.

Tim is using "fiscal austerity" as a surrogate for spending cuts, and I strongly suspect that, if the GOP wins the White House as he asks us to assume, that at least a symbolic spending cut will be on the agenda.  If the Senate goes and the House stays Republican, the cut may be more than symbolic.

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