Obama Freezes Federal Pay for Two Years, Sees $2 Billion Savings

Chipping $2 billion off the $1.3 trillion federal deficit, President Barack Obama on Monday ordered an immediate two-year pay freeze on federal civilian salaries.

Blaming "the irresponsibility of the past decade," Obama said the cost-cutting measure was needed because "families and business are still hurting."

The administration calculated that the two-year pay freeze -- which does not include military personnel -- will save $2 billion for the remainder of fiscal year 2011, $28 billion over the next five years, and more than $60 billion over the next 10 years.