Morning Bell: The Obama Budget: Higher Taxes, Higher Spending and More Debt

The Heritage Foundation ^ | February 1, 2010 | Conn Carroll

[myknowledge]

President Barack Obama will submit a $3.8 trillion budget proposal for fiscal 2011 to Congress today. One might hope that given last year's $1.4 trillion budget deficit was an all-time high and the President promised a spending 'freeze' in last week's State of the Union, this budget might signal a change in direction from the White House. No such luck. President Obama's new budget is full of billions of dollars in new spending for failed government programs, higher taxes on American families and businesses, and deficit spending for as far as the eye can see.

At the very least, the budget document President Obama is submitting today exposes his spending 'freeze'; promise for the fraud that it is. As outlined last week, the administration would halt spending increases for only a $447 billion sliver of our total budget, with a total of $15 billion to be saved. That is less than half a percent off of last year’s spending. Worse, this isn't even an across-the-board spending freeze; it is an aggregate one. So 'spending cuts'; in parts of the budget are immediately channeled to others. For example, even though the federal government does not need any money for the Census next year, President Obama counts the $5 billion spent this year as a 'spending cut'; that can be immediately spent on other government programs, such as a 16% increase in Department of Education funding, a 6.8% increase in Department of Energy funding, and increases for ineffective Health and Human Services programs like Head Start and sex education.

Given the best case scenario, the most the White House hopes to save from this supposed spending 'freeze' is $15 billion. And that is easily dwarfed by just the $100 billion President Obama wants for his Economic Stimulus II plan. Then there are the tax hikes, including higher taxes on families earning more than $250,000 and a brand new tax on financial institutions to pay for the failed automobile union bailout.

And what is the end result of all of President Obama’s new taxes and spending? A record national debt. According to the White House Office of Management and Budget, the United States will post a $1.556 trillion deficit in fiscal 2010, which the Obama administration claims will be reduced to $1.267 trillion in fiscal 2011, thanks to their budget. Given this administration's budget forecasting record, however, expect that final deficit number to go up. The Obama administration now forecasts $5.08 trillion in debt over the next five years; that is 35% more debt than they forecast just 12 months ago.

A common sense budget would move our country in a much different direction. For starters, the remaining TARP and stimulus funds should both be rescinded. Next, instead of the President's fungible 'aggregate' spending freeze, tough hard spending caps should be enacted. Finally, Congress should disclose the massive unfunded obligations of Social Security, Medicare and Medicaid; put those programs on long-term budgets; and enact the necessary entitlement and programmatic reforms that can keep government within those limits.

Quick Hits:

• Defending the secret negotiations and special interest deals used to advance President Obama's health care plan, Speaker Nancy Pelosi (D-CA) told journalists: 'The American people don't care about process.'
• According to Rasmussen Reports, 76% of voters generally trust the American people more than political leaders on important national issues, and 70% believe that the government and big business typically work together in ways that hurt consumers and investors.
• Since some states have already spent the money on the belief that President Obama's health care legislation would pass, the administration's budget includes an additional $25 billion in Medicaid funding for states, an amount that was originally part of Obamacare.
• According to Gallup, the percentage of Americans dependent on government-based health insurance grew last year, while the percentage with employer-based healthcare dropped.
• The United States will deploy a missile defense shield to protect American allies from a potential Iranian strike.

[myknowledge]

'Spending freeze' = bogus.

It's big government, big spending and mountainous debt rolled into one policy.

[Frantzie]

It is not even spending it is outright theft. No one knows where the money is going.

[Frantzie]

It is not even spending it is outright theft. No one knows where the money is going.

[Caipirabob]

There can now be no doubt Obama is intentionally trying to destroy our nation by bankrupting it.

[ronnie raygun]

We can only hope that he and his clown posse are not successful in thier diabolical scheme, ten months till November.

[lurk]

It’s all okay, because they’re really smart.

[GailA]

TRICKLE DOWN DESTRUCTION OF THE ECONOMY

[lacrew]

Couldn’t Dave Ramsey give Bamy a free course.