- The Washington Times - Friday, March 20, 2009

Staggering budget numbers released Friday showed President Obama’s budget plans will nearly double the cumulative deficit over the next 10 years, higher than the president himself projected and damaging his ambitious plans to overhaul health care and boost sources of alternative energy.

The Congressional Budget Office, the nation’s official scorekeeper, says new spending and a worsening economy over the last six months will produce a $1.8 trillion deficit in 2009 — four times the previous record set in 2008, and $400 billion more than projected two months ago.

Their 10-year estimate is also $2.3 trillion worse than Mr. Obama’s own budget predicted, prompting lawmakers on Capitol Hill to call the administration unrealistic.

CBO’s word is the gospel. Congress and the Administration need to get the message,” said Sen. Charles E. Grassley, Iowa Republican.

Republicans said the numbers make Mr. Obama’s budget goals impossible. Democrats have been less adamant, but reluctance is growing even among his own party. Liberal pressure groups, though, said the red ink only underscore the need for more spending now, arguing it will boost the economy and provide a safety net for those hurt by the downturn.

“If we don’t deal with the major underlying problems with the economy and make it possible for business to create jobs, our deficits will only continue to explode,” said Tom McMahon, acting executive director of Americans United for Change.

The White House said the numbers don’t change their overall goals of getting Congress to act on health care, global warming and education, and Office of Management and Budget Director Peter R. Orszag said they believe Congress is still on track to do that.

“No one ever had an expecation they would just take our budget,” he said, adding there’s also “significant uncertainty” about CBO’s projections, and said there’s a chance things will be better than the numbers show now.

Conservative-leaning Democrats and budget hawks had anticipated this week’s budget numbers with apprehension.

House Budget Committee Chairman John Spratt, South Carolina Democrat, said they will “follow President Obama’s lead” on their budget. House and Senate budget committees are expected to produce budget outlines next week.

But Mr. Obama’s plans to impose a carbon emission cap-and-trade program, to cut farm payments and to expand health care in part by reducing the tax deduction the wealthy can take for charitable donations are all running into opposition.

The CBO report contains little good news — the housing market is still poor, job losses are mounting and CBO says overall the economic outlook “has worsened considerably” from just two months ago. Still, CBO predicts a faster rebound in 2010 and 2011 than many others.

CBO says government spending would account for 27.4 percent of all U.S. economic activity this year, which is the highest rate since the country fought World War II.



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