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Clinton, Bill

Clinton Administration Proposes Spending Cuts to Offset Tax Relief

Strategic Insights

— 1 min read

The Clinton administration has outlined spending cuts to balance the fiscal responsibility of proposed tax relief measures. The president has committed to offsetting the $60 billion in middle class tax relief over the next five years, and his administration has proposed major cuts to several federal agencies, including the Department of Housing and Urban Development (HUD) and the Department of Energy.

Key Takeaways:

  • The Clinton administration proposes cutting the HUD budget by eliminating 60 programs and streamlining them into three by 1998.
  • The Department of Energy plans to cut its budget by at least $10.5 billion, with Deputy Secretary Bill White stating that these cuts are "real" and "not just some cuts from some projected future increase."
  • Vice President Al Gore claimed that the administration has already cut nearly 100,000 federal jobs and that today's proposals are a continuation of that effort.
  • Republicans, including incoming Senate Budget Committee Chairman Pete Domenici, suggest that they will cut deeper than the White House and may even eliminate entire departments.
  • The president's plan to offset the cost of tax relief may not be sufficient, as the cost of the plan would nearly double during the second five years it's in effect to about $115 billion.
  • The Republican tax cut plan is estimated to cost more than half a trillion dollars over the same period.

Statistics:

  • $60 billion: The amount of middle class tax relief promised by President Clinton over the next five years.
  • $10.5 billion: The minimum amount of budget cuts planned by the Department of Energy.
  • $115 billion: The estimated cost of the president's plan to offset the cost of tax relief during the second five years it's in effect.
  • $500 trillion: The estimated cost of the Republican tax cut plan over the same period.
  • 100,000: The number of federal jobs cut by the Administration since 1992.

Sources:

  • NPR's John Ydstie report on "All Things Considered"
  • The White House press briefing on proposed spending cuts
  • NBC's Meet the Press
  • The Treasury Department's analysis of the president's tax plan and the Republican tax cut plan.

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