When the biggest spender in America’s history says it’s time for government to live within its means, it is reasonable to ask: Who does President Obama think he’s kidding? Mr. Obama’s new budget is the latest installment in a series of proposals featuring flawed estimates based on unrealistic economic assumptions. It should be considered dead on arrival.
Mr. Obama’s latest public-relations ploy tries to portray him as some kind of deficit hawk. The reality is the savings of $1 trillion over 10 years he’s touting wouldn’t be necessary had he not treated the federal budget like a teenager who swiped his parents’ credit card. To put his alleged savings in perspective, $1 trillion is a little more saving over a decade than the government blew on a stimulus program that produced no measurable results. From another angle, with $100 billion of deficit reduction per year, Mr. Obama could pay down the current fiscal year’s deficit in 16-20 years, assuming he balanced all future budgets, starting with next year’s. Good luck.
Mr. Obama’s claims for future savings lack credibility to begin with. Look at the track record: The Fiscal Year 2010 budget projected a deficit of $581 billion in FY 2012. The FY 2011 budget projected $829 billion of red ink in 2012. And now the FY 2012 budget itself projects $1.1 trillion, a deficit 89 percent higher than the one Mr. Obama’s numbers crunchers projected for the coming fiscal year two budget cycles ago. This crowd can’t even get things right in the near term, let alone 10 years out.
The White House budget is calculated against unrealistic assumptions. According to Mr. Obama’s prognosticators, growth will be sustained between 3.6 percent and 4.4 percent through 2015 and will be even stronger through 2021. You don’t need Nostradamus to know those figures are cockeyed.
The budget further projects that the country will have 6.3 percent unemployment in 2014, and 5.3 percent in 2017, hopeful numbers that only have a chance of coming true if Mr. Obama is a one-term president. The unemployment rate is another figure the White House has had a hard time coming to grips with. In January 2009, the Obama administration sold the economic stimulus boondoggle with a projection that claimed without the plan, unemployment would be around 8.5 percent by the first quarter of 2011, but with the stimulus, the jobless rate would be around 7 percent. Unemployment is currently at least 9 percent, but what’s a few million jobs between friends?
Mr. Obama is cleverly trying to focus attention on the purported $1 trillion of 10-year savings while ignoring the fact that the monstrous debts America faces are his fault. His “painful cuts” are in fact minor trimming on government programs he spent two years fattening up. Federal outlays are 37 percent higher than they were four years ago. That is a trillion dollars of new annual spending. On Monday, Mr. Obama made a sleight-of-hand claim that he will lower discretionary spending to the lowest share of the economy since the Eisenhower administration. But according to the Obama plan, by 2020, federal spending will grow to double what it was in 2007. And this year, Mr. Obama’s debt mania will drive the national debt to over 102 percent of GDP, something which hasn’t happened since the United States was bogged down in the global conflagration of World War II.
The president needs to live in the here and now. Instead, Mr. Obama is focused on imagined futures where the only certainty is that someone else will be dealing with the horrendous problems he keeps creating.