
Obama’s budget proposes cuts
President Obama’s new budget proposal is an interesting moment as Obama is now admitting that the time for fiscal stimulus has passed and that cuts needs to be made. As one administration official tells The New York Times, “The debate in Washington is not whether to cut or to spend… The question is how we cut and what we cut.” Interestingly, Obama has proposed a ratio of two third spending cuts and one third tax rises. By contrast, the bi-partisan Simpson Bowles commission on the deficit proposed something very similar to the 80 percent spending cuts, twenty percent tax rises model that Osborne is using. But the most interesting contribution
