Talk Radio News Service: News, Politics, Media

By Benny Martinez - University of New Mexico/Talk Radio News Service

U.S. Office of Management and Budget (OMB) Director Peter Orszag said Thursday that the steps currently being taken to reduce the national deficit, although effective, are not enough.

The 2001 and 2003 tax cuts to those who have an income of $250,000 or more will expire as scheduled, Orszag said. In the coming decade, this will reduce the deficit by nearly $700 billion.

Transitioning to a clean energy future by eliminating fossil fuel subsidies delivered through the tax code will reduce the deficit by about $40 billion in the next ten years.

And the three-year freeze of non-security discretionary spending will further reduce the deficit an additional $250 billion, solidifying a $1.2 trillion reduction in national deficits.

“Even with that $1.2 trillion in deficit reduction, the deficit remains higher than we’d like it to be,” Orszag said. “[This] is why we are calling for the creation of a bipartisan fiscal commission to put forward recommendations to get us the rest of the way to a stable debt trajectory.”

Orszag added that this would involve overall deficits of roughly 3 percent of the economy by 2015.

According to Orszag, deficit reduction is evident in the coming decade but he remains skeptical about the long-term fiscal challenge, saying that the root cause of the country’s deficit is the rate at which health care costs are growing.

“We are eager to continue to work with Congress to finally enact comprehensive health reform legislation, Orszag said. “[This] helps to reduce the deficit, not only over this decade, but equally important, puts in place the infrastructure that will allow us to decrease deficit by increasing amounts thereafter.”