On Monday Treasury Secretary John Snow notified Congress that the administration had taken "all prudent and legal actions" including tapping certain government retirement funds to keep from hitting the $8.2 trillion national debt limit. (This may explain why Congress mandated the Postal Service to develop an escrow fund)

Snow has urged Congress to pass a new debt ceiling to keep the nation from experiencing it's first ever default on obligations.

One of the federal budget-cutting measures passed by Congress and signed by Bush last month could result in severe budget cuts and layoffs in the human services staff around the country. The Deficit Reduction Act affects case-management services on the county level, which includes child protection, juvenile corrections, mental health treatment for adults and children, and services for the developmentally disabled.

Fewer social workers means less time with each client, due to increased case loads. Keeping tabs on the mentally ill to ensure they are taking their meds keeps them out of institutions, which is much more expensive in the long run. Keeping tabs on the child in the possibly abusive home who may need to be removed and placed in foster care now may result in tragedy, either in the form of removing the child unneccessarily as a precaution due to lack of time to devote to the case, or in the child's suffering abuse that could possibly have been prevented with sufficient attention.

The 216 - 214 on Feb 1 in the House after Senate passage showed this was not a popular bill; still, it passed. The bill does not spell out the exact cuts to be made, but counties are preparing for the worst case scenario.

I don't think this is the kind of spending cuts most of us were thinking of when Bush talked about reducing government, cutting spending, and being a compassionate conservative.

(The savings projected from this bill would be nearly $40 billion over 5 years)

Well we all know how popular of an Idea is is when taxes are raised.
You either cut spending, or raise taxes, and since Bush's mantra has been tax cuts....you have to cut spending. You can't spend what you don't have.
Some people would say the War is the culprit, and Clinton was the best, because his PROJECTED budget had us in the green.
Since I never saw a day in which the Government hasn't spent what it didn't have, I tend to think that was a book cooking incident al la Enron.
9/11 also had a big impact on that, the Market was shaky at best for a long time after that.
Couple that with Bush's expansion of Big Government, and the War on Terror, and you have a recipe for something being cut along the way.