Rep. Costa breaks down spending cut saga

jsmith@mercedsunstar.comMarch 18, 2013 

Despite reducing funding for a wide range of local public agencies, Rep. Jim Costa recently said deep federal spending cuts, known as sequestration, are part of a larger plan that could put the country on the path to a "robust recovery."

"If it's permanent, it provides almost $1 trillion in cost saving over the next 10 years," said the Democrat from Fresno.

The congressman said that Washington could be closer to completing a long-term, deficit-reduction deal than many people think.

"The grand bargain between the president and speaker (of the House John) Boehner two years ago -- when the initial talks were to pattern roughly what the president's commission, the Simpson-Bowles Commission, outlined -- was $4.2 trillion in cost savings between a combination in cuts and increases in revenue," he said.

"When you look at what's been done, and it hasn't been pretty over the last two years, but now with sequestration, we're almost at $4 trillion," he added.

The congressman characterized the ongoing debt-reduction negotiations as a "four-act play," in which the recent $85 billion in sequestration cuts was Act 2.

"Now that we've been unwilling to make the choices ourself, we're all blaming each other for sequestration, when we were all the enablers for it," he said. "To point fingers, I think, is not appropriate."

Act 1, he said, was the agreement in Washington that brought roughly $600 billion in tax increases and spending cuts. Act 3 is the upcoming budget negotiations for the next six months.

The finale, Costa said, will be the debt-ceiling negotiations this summer.

The economy will be poised for a strong recovery if Congress can agree to revise the tax code, close corporate tax loopholes and cut entitlements such as Medi-Cal and Social Security, he said.

"American corporations are sitting on the largest cash reserves in 60 years, and American consumers are saving at a 20-year high," he said. "The only thing that's preventing us from having a strong recovery is just some certainty in Washington."

Reporter Joshua Emerson Smith can be reached at (209) 385-2486 or jsmith@mercedsunstar.com.

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