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Credible research and impartial information are critical to fostering fiscal responsibility. The Institute to Reduce Spending engages in and promotes rigorous academic research and scholarship on the subject of federal spending and budgeting. We seek to create a national, nonpartisan dialogue regarding spending reform by presenting information in a publicly accessible manner.

House and Senate prepare to move ahead on 2018 Budget

This week, the House and Senate have been crafting their drafts of a 2018 budget resolution, but the two chambers still have a ways to go in order to reach an agreement.
The House budget seeks to cut Medicare and Medicaid by $473 billion and $1 trillion over the next decade, respectively. In addition, it would find savings from entitlement programs such as food stamps and student loan programs.
The Senate’s plan would keep defense spending flat over the next 10 years, while cutting $5.1 trillion in domestic spending.
Senator Bob Corker (R-TN) expressed his discontent with what seems to be a Senate budget that will add $1.5 trillion to the deficit, saying that the debt, “is the greatest threat to our nation.”
Congress will have to iron out the details by their December 9th deadline to pass the budget resolution. The 52 Republicans in the Senate will require support from Democrats in order to reach the 60 vote threshold to send the legislation to the President’s desk.

Jonathan Bydlak in The Hill: Don’t Let Debt Reduction Become Second Fiddle

Writing today in The Hill, Institute founder & president Jonathan Bydlak writes about ongoing tax reform efforts and presents a note of caution for fiscal conservatives not to have too narrow a focus.

But as Democrats and Republicans neatly swap positions on how much the deficit matters, both sides are at risk of missing the point. Debates over revenue offsets and dynamic assumptions are important, but the real culprit behind rising deficits and the $20 trillion national debt is runaway spending.
Yet, many in both parties still stubbornly ignore this issue, especially the items that drive the vast majority of spending — the nation’s massive (and massively unsustainable) mandatory programs. Out of a misguided but well-intentioned desire to avoid impacting current beneficiaries, both parties seem happy to skip along the path that will soon lead to dire consequences not only for beneficiaries but for the entire economy.
Fiscal responsibility, much like Ronald Reagan’s famous three-legged stool, cannot be achieved with too-narrow a focus.
Truly reforming our nation’s finances requires taking aim at a broken and outdated tax code, but it must also include steps toward reining in ever-growing liabilities and instituting process reforms that can make it possible for Congress to operate under regular order and within a real budget framework, not endless short-term measures and governing by crisis.

Read the full piece here.

What $20 trillion means for you

The US National Debt has officially crossed a sobering milestone this week, crossing $20 trillion for the first time in history. It’s hard to overestimate the significance of such a massive liability, but with numbers so large, the real-world consequences can be forgotten. What does this number really mean?
For one, the debt held by the public is now a shocking 77 percent of the entire US economy. A liability that high means that the economy can lag, investment in other areas can be crowded out, and huge amounts of money go every year just to paying interest on the debt. For another, such high debt makes it much more difficult to respond to unexpected events and crises.
What’s worse, even assuming everything goes as expected in the future, it won’t be long before deficits and debt rise to levels that are not just troubling but impossible to deal with and could even cause a national economic crisis.
Today’s milestone is not surprising — the choices to reach that point were already made, and have been being made for decades. Now is the time for lawmakers to start considering the tough choices necessary to turn things around.

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