NM Would Lose $228 Million if Congress Takes Cuts-Only Approach to Federal Deficit Reduction

Ryan Budget Cuts Would Be Three Times Bigger Than Automatic ‘Sequestration’ Cuts Scheduled for January

August 8, 2012

CONTACT: Sharon Kayne, Communications Director, NM Voices for Children
505-244-9505 ext. 110 (p), 505-401-8709 (c), 505-244-9509 (f), skayne@nmvoices.org

ALBUQUERQUE, NM – A cuts-only approach to reducing the federal deficit–an approach that would not include any new revenue–would almost certainly damage New Mexico’s economic recovery and future economic growth by slashing federal investments in schools, roads and bridges, first responders, and disaster relief.

The House-passed budget from Congressman Paul Ryan is an example of a cuts-only approach. Under Ryan’s plan, New Mexico would lose an estimated 22 percent–or $228 million–in federal funding for education, clean water, law enforcement, and other state and local services in 2014 alone.

That’s  according to a report released today by the Center on Budget and Policy Priorities (CBPP), a non-partisan policy research organization based in Washington, D.C. Ryan’s plan also would shift other very large costs to states by sharply reducing federal funding for Medicaid.

“Deficit reduction shouldn’t come at the expense of New Mexico’s families and economic future,” said Gerry Bradley, Research Director for NM Voices for Children. “Spending on state programs did not cause the deficit, which ballooned under President George W. Bush. Tax cuts for the rich and two un-funded wars are largely to blame. It’s only right that Congress take a more balanced approach to the deficit and that includes raising revenues.”

There is broad bipartisan agreement that significant deficit reduction is needed. Federal policy makers also generally agree that cuts to major parts of the budget–defense, Medicare and Social Security–should be limited over the next decade. Federal funding for state and local programs are one of the few remaining sources of large potential savings in a cuts-only approach.

These cuts likely would bring federal aid to state and local governments to historic lows. Congress already made deep cuts to state and local aid last year and New Mexico made deep cuts over several years as a result of the recession.

The funding cuts to states, counties, and cities under the Ryan budget proposal would far exceed the automatic cuts–referred to as “sequestration”–that are scheduled to begin in January. In 2014, the Ryan budget cuts would be three times as deep, inflicting far more damage than sequestration.

“Congress should to enact a balanced deficit-reduction package that includes new revenue and replaces the automatic budget cuts scheduled for January,” said Bradley. “It should avoid any unbalanced plans that would undermine our state’s economic future.”

The CBBP’s full report can be found at: http://www.cbpp.org/cms/index.cfm?fa=view&id=3816.


New Mexico Voices for Children is a nonpartisan, nonprofit organization advocating for policies to improve the health and well-being of New Mexico’s children, families and communities. Our fiscal policy work is funded by grants from the Annie E. Casey Foundation, the McCune Charitable Foundation, the WK Kellogg Foundation, and the Working Poor Families Project.
2340 Alamo SE, Suite 120, Albuquerque, NM 87106-3523; 505-244-9505 (p); www.nmvoices.org