The 2009 budget deficit was $1.4 trillion. In February of 2009, President Barack Obama spoke at a “Summit for Fiscal Responsibility.” He proclaimed that “We cannot and will not sustain deficits like these without end" and pledged to cut the deficit he inherited in half by the end of his first term in office. He further noted that if we as a country attempted to address the economic downturn “without also confronting the deficits that helped cause it, we risk[ed] sinking into another crisis down the road.” According to the president, we could not “simply spend as we please[d] and defer the consequences to the next budget, the next administration or the next generation.” I could not have said it any better.
In Obama’s first budget, he projected a $533 billion deficit in fiscal year 2013. Based upon information released on Friday, the president’s budget will project a $1.3 trillion deficit this year and a $901 billion budget gap in 2013. I guess we’ll have to wait for the next administration after all, as the next generation picks up the tab for Obama’s fiscal irresponsibility.
The Obama administration claims they are going to cut the budget deficit by $4 trillion over the next 10 years. At first blush, this might seem impressive. But let’s take a little closer look. Obama takes credit for the one trillion in cuts already agreed to last summer. He also takes credit for $850 billion in savings from winding down the wars in Afghanistan and Iraq; as though we were planning to continue spending at 2011 levels through 2023. He is also proposing to raise taxes on the wealthy to garner $1.5 trillion in added revenue.
In sum, Obama is proposing $1.5 trillion in new taxes; $1 trillion in reductions that were already signed into law; and $850 billion in cuts to wars we weren’t going to be fighting anymore. Altogether, these “deficit reductions” amount to $3.35 trillion of the president’s proposed $4 trillion in deficit reduction. In other words, he only plans to really cut proposed spending by a meager $650 billion over 10 years. That’s roughly six months of deficit spending under Obama, and no doubt back loaded to take effect long after he leaves office.
According to the CBO, we are on pace to spend $44.25 trillion over the next 10 years and Obama is proposing to take us all the way down to $43.6 trillion; a 1.5% reduction. I’d call that a rounding error. Something tells me we won’t be seeing our AAA rating restored any time soon under this scenario.
Obama is once again disregarding recommendations from the deficit reduction committee he himself appointed. Nearly every reasonable person acknowledges that our entitlement programs are on path to bankrupt our country. Over the summer, we heard a lot of rhetoric from the Obama administration about their willingness to reform our entitlements. One would think his budget proposal might be a good place to put those ideas on paper; apparently not. I guess the administration made the calculated decision that they are better off sitting on the sidelines, demonizing the GOP’s attempt to reform entitlements. What would they do with those great ads showing Rep. Paul Ryan (R-Wisc.) pushing grandma over the cliff?
Thankfully, we don’t have to worry about this budget ever passing. Obama’s last budget was so preposterous it couldn’t even muster up one vote in the Senate. Then again, the Democrats haven’t voted for a budget in nearly three years. They held the House and a filibuster-proof majority in the Senate for the first two years of the Obama administration, but never bothered to pass a budget.
As Obama stated back in 2009, our runaway deficit spending will cause us to sink into another crisis down the road; a crisis that will make our recent troubles look like a picnic. If only his actions matched his rhetoric.
Photo Credit: Jamesomalley