Photo Credit: Official White House Photo by Chuck Kennedy
By Bill Wilson — Only in Washington, D.C. can a proposed budget that increases spending and borrowing every single year be considered to somehow reduce the deficit. The latest Obama budget for Fiscal Year (FY) 2013 — and how the Administration is spinning it — was no exception.
According to Barack Obama himself, the proposal would somehow “reduce” the deficit by $4 trillion. By every measure, however, there is simply no way to get there.
An even bigger whopper was tossed out by departing White House Budget Director Jack Lew, who on Meet the Press said, “The president’s budget has $1 of revenue for every $2.50 of spending cuts.”
The Office of Management and Budget’s (OMB) baseline for 2013-2022 says outlays will total $47.053 trillion. Obama’s proposed budget takes that to $46.959 trillion. Since spending actually increases every year under Obama’s proposal, the only cut is off of the baseline — and that’s just $94 billion of so-called “cuts”.
Meanwhile, OMB says revenues over the next ten years will total $38.391 trillion. Under Obama’s proposal, that goes up to $40.274 trillion — an increase of $1.883 trillion in taxes, mostly on job creators.
By our count, that’s about $20 of tax increases for every dollar of “cuts,” and those are not even real cuts to the actual budget. Spending would still increase every single year under Obama’s proposal. Meanwhile, the tax hikes are real.
No wonder we’re sinking into the Abyss. The national debt is more than $15.3 trillion and increases by $1 trillion every year. Politicians do not even know how to add and subtract.
At best, Obama’s budget can claim $1.977 trillion in deficit reduction off of the current baseline, but over 95 percent of that is because of tax increases.
So, how did Obama get to $4 trillion? By his own admission, he includes “the cuts that we’ve already made” under the so-called debt deal. But even then, what was supposedly $1 trillion of savings only cut actual spending in 2013, and then only by a paltry $62 billion. Every other year under the baseline, spending will increase, too.
Everything Obama says is suspect. His budget director’s claims are just more imaginary numbers from the government — pure propaganda designed to prevent the American people from seeing the true dire straits our fiscal house is in.
The fact is, this quarter the national debt will grow to be larger than the entire economy, probably never to return to below 100 percent of the GDP. The reason is because while the economy only grows at a tepid pace of less than 2 percent, the debt continues to expand by about 10 percent every year.
By 2021, under Obama’s budget, the national debt will total $25 trillion.
No country has ever sustained such borrowing. Remaining the world’s preeminent economic superpower is impossible under such policies. Obama is pursuing a purposeful policy of national decline. It will take new leadership to get the Ship of State back on course.
Bill Wilson is the President of Americans for Limited Government. You can follow Bill on Twitter at @BillWilsonALG.
