You say he doesn't know how things work, but he's got a good point that we need to stop borrowing money from other countries. I mean, there's a LOT of better costs to cut get before you get down to the Muppets, but we shouldn't be borrowing money from China for them, either.
Or, you know, we could just stop wasting money on the wars and military. Over 50% of federal income taxes are spent on the military. We could cut military spending by 5% and more than adequately fund each of the items he proposes to be cut.
That's actually a great idea, when you think about. There are probably lots of unsold Elmo toys in a warehouse somewhere. Just shove some C-4 into them, drop them from airplanes, and then *BAM*, explosions. People see Elmos parachuting out of airplanes, they'll think maybe the war is over. So they'll relax. And then the war will be over.