President Obama offered his FY 2015 budget proposal today. There were not a lot of surprises, as the key elements of the budget had been leaked over the last week or two. This is how Obama characterized the document in his appearance at an elementary school:
[I]t enables us to meet our obligations to future generations without a mountain of debt.
This is mystifying. Currently the federal government is more than $17 trillion in debt. Obama’s budget proposal does nothing to reduce that debt; on the contrary, it adds hundreds of billions of dollars to it every year. If you believe the administration’s rosy economic projections, the budget would add $8.3 trillion to the national debt. Otherwise, more.
This budget adheres to the spending principles members of both Houses of Congress have already agreed to.
No, it doesn’t. President Obama signed the Bipartisan Budget Act of 2013 into law on December 26, 2013–barely more than two months ago. His budget busts the spending caps in the Bipartisan Budget Act by $56 billion in FY 2015 alone, and by $791 billion over the ten years covered by the budget proposal.
Is Barack Obama a liar of epic proportions, or has he gotten so out of touch with reality that he really doesn’t understand how crazy his claims are? Or, perhaps, both? You can only imagine what would happen to a budget like this, and to the administration’s claims about it, in a country that had a free press!
Here are some basic facts about the president’s budget, from staffs of the Senate and House Budget Committees:
* Contrary to President Obama’s assertions, we are not in an “era of austerity.” Since 2009, we’ve added $6.8 trillion to the debt and spent $17.6 trillion.
* The President’s budget increases spending by $791 billion over 10 years and by $56 billion in 2015 above the Murray–Ryan spending agreement that he signed into law just two months ago.
* His budget will increase total spending by 63 percent from today’s levels over the next 10 years.
* President Obama’s budget never balances—ever.
* It would add $8.3 trillion to the debt over the next 10 years.
* Cumulative deficits would amount to $5 trillion, and gross debt would climb to $25 trillion in 2024.
* President Obama’s plan nearly quadruples interest costs, which remain the fastest growing item in the budget.
* Interest this year on the debt would be $223 billion, but would rise to $812 billion in 2024 under his plan.
Taxes Hiked (Again) To Pay for New Spending:
* President Obama has already increased taxes by $1.7 trillion. Now, he wants another $1.8 trillion on top of that.
* Roughly half of the new tax hikes would be dedicated to new spending rather than deficit reduction.
A Booming Washington, D.C.—and a Shrinking American Middle Class
The share of Americans over 16 who are working is at its lowest level since 1978. Real wages are lower today than in 1999. One in five U.S. households is on food stamps. But what do the President and his party propose? A health law that will remove the equivalent of 2.5 million full-time workers from the workforce; an energy policy that drives up costs and destroys jobs; a regulatory policy that sends U.S. jobs and wealth overseas; a tax policy that closes plants and factories; a welfare policy that discourages work; and a spending policy that crushes economic growth and threatens the future of America’s youth.
The president’s budget reinforces a point I have made over and over: it is foolish to take seriously any spending agreement, bill or budget, except to the effect that it deals with spending now. Promises about what will happen in the out-years are completely meaningless. As is obvious if you go back and review any presidential budget from years ago, or any spending agreement that purported to be binding years into the future, the out-years never come. The ink is barely dry on December’s spending compromise, and the Democrats are ready to break it.
As bad as the numbers in Obama’s budget are, the reality will be even worse. The budget makes a number of implausible assumptions, including–to take just one example–that comprehensive immigration reform passes, and the economy booms as a result. Right.
It probably isn’t worthwhile to get too exercised over Obama’s budget proposal, as it will never be brought up for a vote, let alone take effect. Senate Democrats have already said that they don’t see any need for a budget this year. So there won’t be a budget, there will only be a series of spending bills. If nothing else, Obama’s budget proposal tells us that the Democrats intend to throw all prior spending agreements into the trash.