Spending cuts?

Reuters reports that President Obama is directing a five percent spending cut across government agencies.

"We are asking each agency to develop a list of their bottom 5 percent performing discretionary programs, as measured by their impact in furthering the agency's mission," White House budget director Peter Orszag told the Center for American Progress think tank.

Sounds like we are on our way toward fiscal discipline, huh? Let's look at the numbers.

What Mr. Orzag is calling for is cuts to discretionary spending. This discretionary spending only makes up on 38 percent of all of the 2010 Federal spending. The majority of the goverment's spending is what is called 'mandatory' where it takes an act of Congress (literally) to change (reduce?) this spending.

Now, this 38 percent is not small change. It is still $1.368 Trillion (we'll use a capital T to give that number its due respect). Five percent of that is $68 billion.

Wow, $68 billion? That is still lots of money. Before you get too excited, lets also look at the changes in spending from last year's budget.

The first number is the total Amount, (percent change from 2009), then the department.

• $663.7 billion (+12.7%) – Department of Defense (including Overseas Contingency Operations)
  
• $78.7 billion (−1.7%) – Department of Health and Human Services
  
• $72.5 billion (+2.8%) – Department of Transportation
  
• $52.5 billion (+10.3%) – Department of Veterans Affairs
  
• $51.7 billion (+40.9%) – Department of State and Other International Programs
  
• $47.5 billion (+18.5%) – Department of Housing and Urban Development
  
• $46.7 billion (+12.8%) – Department of Education
  
• $42.7 billion (+1.2%) – Department of Homeland Security
  
• $26.3 billion (−0.4%) – Department of Energy
  
• $26.0 billion (+8.8%) – Department of Agriculture
  
• $23.9 billion (−6.3%) – Department of Justice
  
• $18.7 billion (+5.1%) – National Aeronautics and Space Administration
  
• $13.8 billion (+48.4%) – Department of Commerce
  
• $13.3 billion (+4.7%) – Department of Labor
  
• $13.3 billion (+4.7%) – Department of the Treasury
  
• $12.0 billion (+6.2%) – Department of the Interior
  
• $10.5 billion (+34.6%) – Environmental Protection Agency
  
• $9.7 billion (+10.2%) – Social Security Administration
  
• $7.0 billion (+1.4%) – National Science Foundation
  
• $5.1 billion (−3.8%) – Corps of Engineers
  
• $5.0 billion (+100%) – National Infrastructure Bank
  
• $1.1 billion (+22.2%) – Corporation for National and Community Service
  
• $0.7 billion (0.0%) – Small Business Administration
  
• $0.6 billion (−14.3%) – General Services Administration
  
• $19.8 billion (+3.7%) – Other Agencies
  
• $105 billion – Other

So, in many cases, the 'cut' would be just reducing the increase from last year.

Here's an idea. How about we just cancel half of the unspent Stimulus money for contracts grants and loans. Or even better, cancel the half and reduce the budgets five percent.

This fiscal discipline comes just in time for the midterm elections. Maybe its a little 'hair of the dog' after going on an 18-month spending bender. Who knows.