Obama’s budget would increase the debt by trillions

The correct way to evaluate President Obama’s budget proposal is illustrated by this line from Jake Tapper of ABC News: It is “a 10-year budget plan that would increase the national debt by $7.2 trillion over 10 years.”

Yes, Tapper goes on to say that this total is “$1.1 trillion less than if [Obama's budget] weren’t implemented.” That $1.1 trillion figure is the one you’ve probably seen atop virtually all other reports on the budget proposal.

But the $7.2 trillion over 10 years figure is the one that matters. The supposedly higher starting point is inflated — and the White House’s projections already include raising taxes on “the rich” after 2012, so don’t try to tell us that’s the problem here. The key point is that there is no requirement for Washington to run a deficit in any of the next 10 years, much less average $720 billion in annual borrowed spending over the coming decade.

In fact, the smallest projected deficit in Obama’s proposal — $607 billion in fiscal 2015 — would be larger, in inflation-adjusted dollars, than any deficit between 1940 and 2008.

As a percentage of the economy, the deficit in the best year (2018) would be at 2.9 percent of gross domestic product — even George W. Bush did better than that in half of his eight budgets. As The Atlantic’s Megan McArdle observes of the 2.9 percent figure, “when that’s the best you can do — when you’re only getting that low at the tip-top of the business/tax cycle — you’re in deep trouble. What happens when there’s another slowdown?”

Reducing the debt by $1.1 trillion would be, as Vice President Biden might put it, a big bleepin’ deal. So would a plan to take us from trillion-dollar deficits to balanced budgets — although we surely could accomplish the latter in less than 10 years. But Obama isn’t proposing either of those things.

Only in Washington does planning to borrow $7.2 trillion and then saying, “Hey, it could have been worse!” count as “deficit reduction.”

– By Kyle Wingfield

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40 comments Add your comment

Some People are stupid

February 14th, 2011
4:22 pm

In all honesty….your parties move to cut 100 billion out of a 1.5 trillion dollar deficit isn’t much better..in fact…1.1 trillion equates to the same cut your party wanted. When either party is ready to tackle the big fish that are truly the cause of the deficit…could someone give me a call.

Kyle Wingfield

February 14th, 2011
4:37 pm

ByteMe

February 14th, 2011
4:50 pm

Even Bush’s last budget in 2008 showed that the deficit could be changed into a surplus by letting the Bush tax cuts expire. Go figure. It ain’t all about the spending, but having doubled the military in the past 10 years certainly has made things worse.

Andy

February 14th, 2011
5:04 pm

The real issue should be: what services are we willing to pay for and how much are we willing to pay for those services. We also don’t ask the question: how much value does a particular service provide? More or less than what we paid for it? Until we ask and answer those questions, we are just engaging in delusional thinking.

arnold

February 14th, 2011
5:17 pm

I’m willing to see some cuts. However, continually cutting taxes and not be willing to raise revenues is foolish. Until both parties are willing to do both, we will have a stalemate and continue in the red.

Real Conservative

February 14th, 2011
5:35 pm

Let’s be honest. The reason that the deficit projections continue to rise despite Democratic and/or Republican cuts is because nobody is proposing to do anything about the cost of health care which is driving up the cost of Medicare. We can cut Social Security benefits and layoff teachers and cops and food safety inspectors as the Republicans want to do, and even cut defense and oil subsidies as Obama proposes, but we’ll still have massive deficits if don’t find a way to control the rapidly rising costs of health care.

jconservative

February 14th, 2011
6:14 pm

“Obama’s budget would increase the debt by trillions”

Kyle you are missing the boat.

Makes no difference what the White House does or says. The House and the Senate have the Constitutional duty/authority to do the budget.

The President send a budget to Congress because he is required to do so by federal Law.

Congress is required to produce a budget per the Constitution.

We do believe in the Constitution do we not?

So lets ignore the President, unless political points are more important than the actual budget, and concentrate on pressuring the House and Senate to produce a balanced budget.

Ho Hum

February 14th, 2011
6:25 pm

Hey Kyle — still waiting on the critical review of GOP Governors you promised a few weeks ago.

You wasted no time in going after democratic governors in the northeast and mid-west and claimed that you’d give the same treatment to GOP governors. But why bother? We all know you’re a hyper-partisan who cannot admit that your beloved GOP can do anything wrong.

If all you can do is turn to the right, you’ll just keep going around in circles.

I Report (-: You Whine )-: mmm, mmmm, mmmmm! Just sayin...

February 14th, 2011
6:38 pm

This ain’t the only budget obozo is blowing out-

•The average workweek for all employees in private, nonfarm payrolls is at a low of 34.2 hours and dropped last month. Employers normally increase the hours for their existing workforce before hiring, for history shows that hours lead bodies as a forward-looking barometer to hiring, so this is a signal that bodes badly for future employment.

•Real hourly compensation dropped in the first four quarters after this recession officially ended, compared to a more typical gain averaging 2.5 percent during the first four quarters of expansion after the previous 10 recessions.

Had enough yet?

Real Conservative

February 14th, 2011
7:33 pm

Guess what? Congressman Mike Pence and Senator Jim Demint introduced the “Tax Relief Certainty Act” today to make all of the Bush tax cuts permanent. That means reducing revenues by TRILLIONS.

Yesterday Speaker Boehner said “We’re broke! When are we going to get serious about cutting spending.” This genius thinks that cutting spending is the same as cutting deficits. But if you’re cutting revenues more than you’re cutting spending, then you’re INCREASING deficits.

Republican borrowing-and-spending is the opposite of fiscal conservatism, and it’s what got us into this hole in the first place. We should have known better than to expect anything different from this crowd.

I Report (-: You Whine )-: mmm, mmmm, mmmmm! Just sayin...

February 14th, 2011
9:33 pm

Iranian police used tear gas and electric prods to crack down on the country’s biggest antigovernment protests in at least a year, as demonstrators buoyed by activism across the Middle East returned to the country’s streets by the tens of thousands Monday.

Aaahh, yes, now we get to see if obozo supports the people or if he supports the terrorists.

I put my money on the terrorists.

Before GunPower

February 14th, 2011
10:06 pm

@ I Report! Who do your whiney arse support? Do you want to rule the entire world? You already started two wars without paying for them!

Puddin Tain

February 14th, 2011
10:09 pm

Wouldn’t it be nice to have all the money back that we wasted in Iraq and Afghanistan?

Scott

February 14th, 2011
10:42 pm

Almost 4 trillion, really, really?? Look at the numbers folks, almost 60% increases in gov’t pensions and welfare costs in recent yrs. There you have it, headed to a decline in this country unless 2012 changes things. You either need to get poor or get a job in gov’t, otherwise you will be left in the cold. Work twice as hard for half the results in pay/benefit. Who would have thought all welfare folks would have iphones and flat screens, what a great country.

Political Mongrel

February 14th, 2011
10:48 pm

Get a grip, Kyle. Bush’s budgets did better, but he deliberately kept the costs of the Iraq and Afghanistan wars OFF THE BUDGET.

And please keep in mind that part of the debt figures people are so overjoyed to quote are debts within the federal government, not to outside sources. It’s money that the federal government is charging itself to borrow money from itself. Honesty is not out there, and it hasn’t been for decades.

BJE

February 14th, 2011
10:57 pm

Political Mongrel with the point of the day. Until we honestly cut defense spending then this is entirely nonsensical political theater and nothing else.

Steve

February 14th, 2011
11:12 pm

Andy’s comment is the best so far. The simple fact is that neither side can balance the budget effectively until we trim the fat off it by prioritizing the payouts and trimming the less important. Every single person knows about the big issues (healthcare, military, education, etc.), but very few people look into all the little special interest group nonsense, or even the ‘little things’ inside each big group. By reducing the smaller items we won’t save much, but it trims some fat. Then we can start digging into the bigger buckets to see what needs to be trimmed there.

As for the trimming of the larger buckets, there is too much bureacratic money being thrown in here. The simple cost of maintaining the IRS alone is staggering. If people new how little of every dollar that goes into the Welfare pool actually made it to the people in need they would be shocked and be asking for resignations.

I understand that now is not the best time to cut jobs but in cutting some jobs you can free up money that can lead to job increases in other sectors, or money that can balance the budget. The money might even go to where it is needed if politicians are really interested in helping out the continual poor decision makers that are overburdening the hard working tax payers.

killerj

February 14th, 2011
11:14 pm

Go Tea Party.

Joe

February 15th, 2011
12:47 am

A balanced budget in 10 years? You must be crazy or stupid.

Lt Dan

February 15th, 2011
12:58 am

A Good Start:

1) Repeal Obamacare;
2) Pass the Fair-Tax;
3) Do away with the Department of Education (it has been a failure);
4) End the “war on drugs” (it too has been a failure);
5) Secure our borders and enforce current laws on immigration;
6) Amend the Constitution so that state legislatures once again have the power to elect Senators;
7) Amend the Constitution so that the President has the power to line-item veto bills;
8) Promote free trade with other countries only through reciprocity (if they trade freely with us, so shall we; if they place tariffs on our goods, so shall we);
9) Give the United Nations one year to find a new residence overseas (unless someone can convince me we should let them stay on our soil) and then evict them;
10) make Washington D.C.a lobby-free zone (lobbying will always take place, but why make it too easy for them?).

That and vote out Obama in 2012 and vote in Herman Cain.

Reba

February 15th, 2011
1:22 am

ID YALL COULD RECALL ANY PRESIDENT IN HISTORY TO COME BACK NOW AND GET US OUT OF THIS MESS—WHO WOULD IT BE? wHO IS SUITABLE FOR THE HUGE JOB AT HAND?

Reba

February 15th, 2011
1:22 am

marty

February 15th, 2011
2:46 am

The previous administration released it’s budget deficit each year and subsequently added a supplemental bill for the hundreds of billions in red ink for it’s endless wars. That way they never showed war spending as part of the official deficit for the year. The current administrations’ budgets reflect total spending. “Conservative” writers never account for this slight of hand gimmickry so the comparisons aren’t really valid.

TnGelding

February 15th, 2011
4:20 am

Federal revenue is roughly the same as it was in Clinton’s last year, Y2K. Why can’t you admit there is a revenue problem as well? Congress knew the deficit would explode. That’s why the Bush changes were scheduled to expire after 10 years. Getting out of Iraq and Afghanistan will go a long way in reducing the deficits, and raising taxes modestly will bring the budgets further into balance. Economic growth should seal the deal. Buffett, Gates and their ilk are going to have to ante up before giving their fortunes away. And the rest of us are going to have to kick in our “fair share.”

TnGelding

February 15th, 2011
4:24 am

Bill Clinton already did it once, Reba.

OBAMA HAS ONLY ADDED ABOUT A TRILLION TO THE DEBT, SO FAR. THE REST BELONGS TO THE IVY LEAGUE COWBOY. (Caps unintended.)

K Conway

February 15th, 2011
6:32 am

No foreign aid, close military bases in Germany and Korea, no IRS or Department of Education or Welfare,close the borders, payback SS fund with federal pension funds and stop stealing …pretty easy to cut the waste!

Toby

February 15th, 2011
7:56 am

Nothing that 12 million jobs won’t cure, where are those jobs bills?

Fix-It

February 15th, 2011
7:57 am

Budget? What do you mean budget that word implies that you have a set amount of money and you allocate the available recourses and then put some away for a rainy day. Obozo has done no such thing; the democrats are acting like a teenager who got a hold of Mom’s purse on payday. If Bush spent like a “drunken sailor” what are the democrats spending like?

JF McNamara

February 15th, 2011
8:49 am

No matter who does the budget, we’re going to have deficits over the next 10 years. Nobody is going to touch Social Security, Medicare, or defense which are the big items.

If the Republicans are serious about cutting without raising taxes, they need to cut defense by 50% and then axe as much off social security and medicare as they can or completely restructure the programs. They aren’t going to do that. They’re cutting 100B which indicates they aren’t really serious about doing anything but talking.

joe

February 15th, 2011
9:25 am

This is exactly why he will lose in 2012…this is not the time to be expanding the debt, even by $1…that, coupled with his socailist/elitist policies of entitlements to all who don’t deserve them, will be his downfall.

retiredds

February 15th, 2011
9:36 am

Hey, Kyle, it might not be the worst thing after all Obama has managed to anger the left, the right, and many in between. If all those constituencies (interest groups) don’t like this budget it probably isn’t half bad at all.

Not So Casual Observer

February 15th, 2011
9:44 am

Lt Dan @ 12:58,

AND;

Eliminate the Department of Energy

Eliminate farm subsidies.

Eliminate all foreign aid until every American citizen is fed and housed.

Eliminate oil and gas tax breaks.

Drill and refine here at the earliest possible date (as in 2012). Stop the purchase of OPEC oil – the Middle East has received trillions of dollars over the past 30+ years and have contributed virtually nothing to the betterment of mankind. Plenty of gold plated cars and palaces but nothing in the fields of medicine or science.

Close our military bases in countries that have not supported our effort in the Middle East and bring the military home to secure the borders.

In 2012 fire any Member of Congress who votes for a budget with a deficit – a cut of $100 Billion is a joke – the cut should be $1.7 Trillion.

Cut the pay of all federal government employees by 20 % ( or more) and eliminate federal pensions for all current employees and those who have retired since 2008.

The continued deficits and borrowing erode the value of the dollar and despite the ADMINISTRATION LIES, there is rapid inflation in the prices of food, gasoline and other staples. Additional federal spending will only make this a DEPRESSION rather than a recession and the short-term “feel good” of SS and Medicare will only result in long-term misery.

sam

February 15th, 2011
10:23 am

“Revenue” = Theft. Sick immoral statist.

retiredds

February 15th, 2011
10:52 am

Not so Casual Observer: I would add to your list any all subsidies for elimination: mortgage deduction, medical expenses, business expenses, charitable contributions, second homes, sail boats, school expenses, child deductions, baby sitter fees, etc. etc. Then you could eliminate the IRS because at the end of the year you would get a post card in the mail which simply says: your earned thus and so. Your tax is 20% on those earnings. Send your check.

retiredds

February 15th, 2011
1:12 pm

Well, Kyle, it is interesting to read the blogs on this subject. It pleases me to see that so many here have begun to articulate the “smoke and mirror” fiscal practices of the Republican “conservatives”, especially those in the last administration under GWB. Many are beginning to recognize that the borrow and spend policies and off budget gimmicks of the “conservatives” is really a con game. So while many of us cringe at the deficits that have been created since the “great decider” left office (having left a $1.3 trillion deficit budget for the 2009 fiscal year and an economy that was in the tank), many here are recognizing that the Republican rhetoric is nothing more than a great deception. So now we come to the juicy part; what will the Republicans do or say to fool the people again? I think that from the tenor of the many of the responses on this blog, the people are beginning to see that the Republicans may just be a bunch of phonies when it comes to the Nation’s fiscal and financial future.

Not So Casual Observer

February 15th, 2011
3:08 pm

retiredds,

You speak of Republicans with such disdain, yet the Democrats in Congress were responsible for the $1.3 Trillion in your post. At least the Republicans do not openly seek the destruction of our economy and dollar as the POTUS and Democrats do so cavalierly.

The Democrat Congress was a disaster and the POTUS continues to display his lack of discernment and failure in foreign policy – unless of course your desire is the destruction of our allies and the American culture, then the POTUS is becoming a roaring success.

The only hope for this once great nation is the tea party philosophy of lower taxes, smaller government and a return to the Constitution.

Not So Casual Observer

February 15th, 2011
3:10 pm

PS.

The elimination of the IRS is critical to the return to freedom, along with the Federal Reserve and the left and far left in the United States.

retiredds

February 15th, 2011
3:59 pm

not so casual observer: over the last 30 years how much of the debt is attributable to the Republicans and how much to the Democrats? Do your own research on this. You may be surprised. (pst. it comes out almost even). Also, when the tea party candidates need to get reelected let’s see how they raise the $$$ (special interests anyone?). So far not many of the t p candidates are making any waves, just falling in line with the Republican leadership. The more things change, the more they remain the same.

Not So Casual Observer

February 15th, 2011
7:25 pm

Define “debt”!

Not So Casual Observer

February 16th, 2011
9:41 am

Since retiredds seems to have retired, if the debt is confined to the current $14+ Trillion and the Obama administration is responsible for the increase from $10+ Trillion to $14+ Trillion – then the $10+ Trillion debt would have to have been 70% generated by Republicans. I think not.