Center on Budget and Policy Priorities

The Path to Fiscal Stability

Greenstein Statement in Response to Republican Budget Offer

"In short, people with low incomes or serious disabilities, and elderly people of modest means, would face substantial cuts — but people at the top would get to keep a significant share of their munificent tax cuts.

"The good news is that Republican leaders have made an offer, non-specific as it is in virtually all key areas, and have accepted that some increase in revenues is needed above the revenue level that would result from extending current tax policies. The bad news is the guts of the offer itself — and its attempt to lock in a requirement for deep cuts in programs on which tens of millions of Americans of modest means rely, without coming clean on the nature and severity of the cuts that would be required."

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Non-Defense Discretionary Programs Will Face Serious Pressures Under Current Funding Caps

"President Obama and Congress achieved $1.5 trillion in discretionary program cuts over the next ten years primarily by setting tight caps on annual discretionary funding in the Budget Control Act (BCA) of 2011. Congress adhered to those caps in 2012 in writing its appropriations bills for that year, but has yet to enact final appropriations for 2013. As part of their deliberations over how to craft a long-term deficit-reduction plan, policymakers may be tempted to cut discretionary funding — and particularly discretionary funding outside the Pentagon — even further. They should not do so, for they do not have room to make such cuts without threatening the government’s ability to provide crucial benefits and services and perform core public functions."

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Understanding the Budget Debate

As policymakers and the public turn their attention from the election campaign to the nation’s long-term budget challenges, here are three related CBPP reports that give some context for the coming debate:

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Additional analyses:

More: Federal Tax Analyses

Pulling Apart: A State-by-State Analysis of Income Trends

Wide and Growing Income Gaps in Most States

The gaps between the incomes of the richest households and poor and middle-income households are wide and growing in most states, according to a major new report from the Center on Budget and Policy Priorities and the Economic Policy Institute that examines inequality at the state level.

Across all states, the average income of the richest fifth of households was eight times that of the poorest fifth as of the late 2000s. New Mexico, Arizona, California, Georgia, New York, Louisiana, Texas, Massachusetts, Illinois, and Mississippi face the largest gaps.

"Prolonged growth in income inequality undermines the basic American belief that hard work should pay off,” said Elizabeth McNichol, co-author of the report and senior fellow at the Center. “Anyone who contributes to the nation’s economic growth should reap the benefits of that growth. But for decades now, those benefits have been skewed in favor of the wealthiest members of society."

Full report | Press release | 50 state infographics | State data tables | National press briefing recording