- The Washington Times - Thursday, May 7, 2009


President Obama on Thursday revealed his full budget proposal for the 2010 fiscal year, which begins in October, by emphasizing steps he is taking to trim wasteful and duplicative spending, and argued that his cuts are meaningful despite the fact that they do little to address the country’s long-term fiscal problems.

“We have to admit that there is a lot of money being spent inefficiently, ineffectively, and in some cases in ways that are actually pretty stunning,” Mr. Obama said, standing with his Office of Management and Budget chief Peter Orszag and deputy budget director Rob Nabors.

“We can no longer afford to spend as if deficits do not matter and waste is not our problem,” he said.

The president framed “fiscal discipline” as a fourth pillar — joining health care, energy and education — of his long-term plan for putting the U.S. on firm economic footing. He hopes the long-term measures will build on the massive emergency measures he currently is taking, largely through the Treasury Department and the Federal Reserve, to revive the economy.

RELATED STORIES: Obama trims budget, but less than Bush

Mr. Obama’s budget calls for reducing or eliminating 121 programs for $17 billion in savings in fiscal 2010, including many defense cuts the administration already announced.

Yet the president’s cuts amount to less than half of 1 percent of the $3.5 trillion budget Congress approved for 2010.

And while $17 billion is a large sum by most accounts, it goes only a short distance toward reducing the government’s future deficits, which are projected at $1.1 trillion this year, and would rise in time to $1.4 trillion if the president’s budget passes as proposed, according to the Congressional Budget Office. Mr. Obama said that his budget plans will cut the deficit in half by the end of his first term, but projections show deficits ballooning after that, back up to more than $1 trillion within the decade.

The cuts also do nothing to address the nation’s long-term obligations to fund entitlement programs such as Medicare, Medicaid and Social Security.

“The only way to really address these out-of-control spending and debt levels is to get at the heart of the problem, which is entitlement spending,” said Senate Minority Leader Mitch McConnell, Kentucky Republican.

Mr. Obama acknowledged these longer-term concerns.

“What we are proposing today does not replace the need for large changes in nondiscretionary spending,” he said.

But he also argued that the cuts he was announcing were significant, even though “in Washington, I guess [$17 billion] is considered trivial.”

“Outside of Washington, that’s considered a lot of money,” he said. “That should be considered real money.”

But in trying to make his case, Mr. Obama misstated the amount of money that he is cutting out of discretionary spending, which is money that is not locked into the budget such as entitlements, but is rather authorized and appropriated each year by Congress.

“It is important, though, for all of you as you’re writing up these stories to recognize that $17 billion taken out of our discretionary nondefense budget, as well as portions of our defense budget, are significant — they mean something,” Mr. Obama said.

However, the amount being cut from discretionary spending, according to a senior budget official official, is $11.5 billion, and the other $5.5 billion is coming from obligated funds, which are much harder to cut than nonobligated funds.

The president’s proposed cuts are also below what President George. W. Bush called on Congress to eliminate a year ago in his final budget.

Mr. Bush’s fiscal 2009 list included reducing or eliminating 151 discretionary spending programs for a savings of $18 billion.

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