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Obama's Spending Freeze Draws Bi-Partisan Ire

Staff Reporters |
January 26, 2011 | 10:35 a.m. PST

Few in the audience applauded at Tuesday night's State of the Union Address when President Obama proposed a five-year freeze on non-defense discretionary spending to help fix the nation’s estimated $1.5 trillion budget deficit. The air essentially went out of the room. 

From Obama's Twitter feed
From Obama's Twitter feed

A freeze would keep spending at current levels in such a way that would, as Time put it in a blog post, “feel like a reduction” because of the growing economy.

Discretionary spending as a percentage of the GDP would shrink by 3.25 percent per year, according to the Congressional Budget Office.

Goldman Sachs analyst Alec Phillips estimated that the freeze would save $200 billion, a little over 1 percent of the total $14 trillion national debt.

After Obama made the announcement, Steve Coll of the New Yorker tweeted, “Wow – everyone hates a five-year freeze – Republicans cuz it’s not enough, Dems cuz it’s too much.”

Republican and Tea Party-backed Sen. Jim DeMint of South Carolina, who has long championed severe spending cuts to close the budget gap, decried the proposal on Twitter.

“Our debt crisis demands spending cuts, not a freeze. When a car speeds toward a cliff, you hit the brakes, not cruise control,” he wrote.

Sen. Mitch McConnell called the freeze “totally inadequate.”

Liberal economist Paul Krugman called the call for the freeze “appalling on every level” in a blog post, writing that Obama’s team is distracting itself from long-term economic problems by focusing on “small change.”

“It’s bad economics, depressing demand when the economy is still suffering from mass unemployment,” he wrote.

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