Responding to Louisiana Governor Bobby Jindal (R) on Monday, CNN's chief business correspondent slammed GOP "weird math" and "balanced budget nonsense" on the sequestration and accused Jindal of being "misleading."
"And it's this weird math that the Republicans are using, that it's just three percent of the federal budget," Velshi ranted. "Except you can't touch entitlements. So it's three percent of a small part of the federal budget, which makes it a very big part of some major agencies," he insisted.
Jindal had argued for more carefully-planned cuts, not for the current three percent cuts:
"I think it is possible to cut less than three percent of the federal budget without causing these devastating consequences. To go to the earlier question, I think you can achieve these reductions without, for example, jeopardizing children's access to vaccinations. I think you can achieve these kinds of reductions...I think it's time for the President to show leadership. I think it's time for him to send to Congress a prioritized list of reductions that preserves critical services."
Even Isabel Sawhill of the left-of-center Brookings Institution told CNN last week, concerning cuts to National Parks, "I think almost any organization can sustain a five percent cut in their budget and not have it interfere with their basic mission." Velshi argued that cuts would be nine percent for non-defense agencies and 13 percent for the Defense Department.
Velshi also attacked the GOP push for a balanced budget. "Throughout history, governments have always racked up debt," he argued.
A transcript of the segments, which aired on CNN Newsroom on February 25 at 1:11 p.m. EST, is as follows:
Gov. BOBBY JINDAL (R-La.): I want to respectfully disagree with my some of my colleagues' statements. I do want to echo what Scott has said, I'll make a couple of points. I think it is possible to cut less than three percent of the federal budget without causing these devastating consequences. To go to the earlier question, I think you can achieve these reductions without, for example, jeopardizing children's access to vaccinations. I think you can achieve these kinds of reductions. Let's be clear, the spending – the federal budget will actually be larger even after these reductions than it was last year.
So I think there is a responsible way to cut less than three percent of the federal budget. I think it's time for the President to show leadership. I think it's time for him to send to Congress a prioritized list of reductions that preserves critical services. Every governor here has had to balance their budgets during tough economic times. Every family out there has to balance their budget, isn't allowed to spend more than they need. Every business has had to become more efficient, tighten their belt. The reality is it can be done. This administration has an insatiable appetite for new revenues. Over $600 billion in new spending under this president. Almost $6 trillion of new debt. Over $600 billion of new taxes just in the most recent deal. Enough's enough.
Now is the time to cut spending. It can be done without jeopardizing the economy. It can be done without jeopardizing critical services. The President needs to stop campaigning, stop trying to scare the American people, stop trying to scare states. Every American knows out there – you just ask the American people, do they believe there's at least three percent of the federal government spending that is wasteful spending and they would tell you there is room to cut the waste without jeopardizing critical services.
So I happen to disagree. I made a suggestion, the President didn't agree with it, I say if these cuts really are that devastating, would he at least consider delaying some of the new spending instead of cutting existing programs? For example, the Medicaid expansions? And he disagreed with that. He did not want to do that, he did not agree. If these cuts are so devastating, why are we spending new dollars to create new programs? So I respectfully – look, he basically – and I don't want to put words in the President's mouth. My sense was that he felt that the election has consequences and he felt that the majority – he was not open to having that conversation again. But again, I'll let the White House speak for themselves.
Bottom line is, you'll hear a diversity of views from the different governors. My perspective is you can cut less than three percent of the federal budget without devastating consequences that – the President needs to show leadership. Now is the time for him to work to avert some of these consequences –
SUZANNE MALVEAUX: Louisiana governor Bobby Jindal speaking there at the mike at the White House. I want to bring him back Ali, because Ali, I know that you've got some things you're taking issue with here. But is he correct when he says that? That it's not going to hurt the way we think it is?
ALI VELSHI: No. And it's this weird math that the Republicans are using, that it's just three percent of the federal budget. That'd be fine if you were cutting three percent across the board. That sounds very reasonable. Except you can't touch entitlements. So it's three percent of a small part of the federal budget, which makes it a very big part of some major agencies. So it's just misleading stuff that Bobby Jindal is saying, number one.
Number two when he says families understand they have to live within their budget. I don't know a lot of families who buy a house with cash. Buying a house on a mortgage, is that living within your budget or is that not living within your budget? Because you'd have to be 80 years old to be able to buy a house with cash. We have an understanding in our society, it may be flawed, that we borrow money based on our future earnings potential. All people do that, companies do that, and governments do that.
Now there's a point at which you can say, we've gone too far with that or we're too much of a risk of not paying back so we'll end up paying a higher interest rate. When you borrow too much money, your personal interest rate goes up, your credit cards go up. That is not – but to suggest this within your means and balanced budget nonsense is just misleading. That is not how families live. It's not how businesses conduct themselves. And it is certainly not since the history of time the way governments run themselves. Bobby Jindal is a smart guy. He runs a state. He needs to not talk like this and it's become very common to hear this kind of stuff coming out in these press conferences.
MALVEAUX: Ali, where is the compromise, though? Is there a compromised proposal here that is reasonable for both sides that they could actually be satisfied with?
VELSHI: Well they both want something that's in this thing. The Democrats really want these massive defense cuts that there's no other way they'll ever get achieved politically. And the Republicans want what a lot of these cuts to these things they call waste. But the truth is the only way you balance the budget in this country, the only way you get to a debt that doesn't keep growing is to attack the entitlements. Social Security, Medicare, those kinds of things and nobody wants to touch that. The compromise is Simpson/Bowles or some version thereof, which does include higher taxes and includes more strategic cuts than these ham-fisted ones that we're seeing right now. That's the issue. The compromise, neither party wants to sit at the table and actually sign off on.
VELSHI: What did he just say? Governor Bobby Jindal is wrong. Throughout history, governments have always racked up debt. Families – do you call it a balance of a budget when you take out a mortgage to borrow a house that you can't afford to buy because unless you buy your house on cash, which not a lot of people do, you're going to have to take out a mortgage or wait until you're 80 years old in order to buy that house. And he's wrong when he says that cutting three percent of the federal budget won't hurt. Because cuts that were spread evenly across the entire budget may not, but that's not what we're doing. We're not touching entitlements, we're only touching discretionary spending, so that's nine percent cuts to non-defense agencies and 13 percent to defense. They're disproportionate. The reason is that these funding reductions would only come from those parts of the budget that they can legally cut. That's everything from the FBI to the FDA to support for the Corporation for Public Broadcasting, Big Bird if you will. Entitlements like Medicare and Social Security would be largely protected, and that's where any dent in the debt would have to be made. So let's be careful about the things that you hear from politicians in the next few days telling you what is and what isn't. I'll keep telling you what is and what isn't here.