CBO: Budget Deal Cuts Much Less Than Advertised

You know that 2011 budget pact that was supposed to have yielded the "biggest annual spending cut in history"? Well, it turns out it'll produce less than 1% of the promised $38 billion in savings by the end of this budget year, according to a Congressional Budget Office estimate released today. The roughly $8 billion in immediate cuts to domestic programs and foreign aid which the House is to vote on today are almost completely offset by equal increases in defense spending, the AP explains.

In all, the new budget will only cut outlays from non-war accounts by $352 million through Sept. 30. Add in war funding, and federal outlays will actually increase by $3.3 billion. Much of the problem is that the budget year is more than half over now, and it typically takes months for money allotted in appropriations bills to leave the federal Treasury. Many of the cuts also come in slow-spending accounts like water-and-sewer grants, while others "cut" into funds unlikely to be used anyway. Republicans insist, however, that if adhered to in the years ahead, the cuts will save $315 billion over the next decade. (More 2011 budget stories.)