Yesterday President Obama proposed a $3.8 trillion budget for fiscal year 2011 that projects record deficits for the next decade. In announcing the plan, the president did what he does best: bash his hapless predecessor. Obama:
The fact is, 10 years ago, we had a budget surplus of more than $200 billion, with projected surpluses stretching out toward the horizon. Yet over the course of the past 10 years, the previous administration and previous Congresses created an expensive new drug program, passed massive tax cuts for the wealthy, and funded two wars without paying for any of it -– all of which was compounded by recession and by rising health care costs. As a result, when I first walked through the door, the deficit stood at $1.3 trillion, with projected deficits of $8 trillion over the next decade.
It is true the Republicans do not have a lot of credibility when it comes to fiscal responsibility. George W. Bush increased the size of the federal government more than any president since LBJ, with the help of GOP congresses. Nevertheless, President Obama did not mention that one of those "previous congresses" was controlled by Democrats. He omitted the fact that Democrats supported a much larger prescription drug benefit than the one that Bush ultimately signed into law. Nor did he note that he has continued to fund two wars "without paying for any of it" and seeks to maintain some of the Bush tax cuts for households making less than $250,000 a year. America's fiscal mess is the result of decades of policies enacted by both parties. Obama says this is "a new era of responsibility." Why can't he take any?
The White House's claim that it is making "tough choices" is absurd. President Obama increased domestic discretionary spending by 84 percent before calling for a three-year "freeze" in FY 2011. While the new budget nixes NASA's manned mission to the moon, it does so while increasing the overall NASA budget. In its budget, the White House counts revenues from non-existent cap-and-trade and health care programs that are unlikely to pass Congress. Rather than using returned TARP monies to reduce the debt, or canceling unspent stimulus funds, the president wants $30 billion in TARP money for a small business lending program and another $150 billion in son-of-stimulus money. An entitlement commission that does not have the ability to force Congress to hold an up-or-down vote on its recommendations is absolutely meaningless.
When the New York Times runs a front-page story that says Obama's "budget draws a picture of a nation that like many American homeowners simply cannot get above water," you get the sense that the president's proposals are in trouble. Paul Krugman may like the sluggish Japanese economy, but my guess is most Americans do not want to live in the same circumstances as their Pacific allies. Washington is waking up to the reality that the country will face a massive fiscal crisis in the coming decades. In this sort of economic and political climate, one can expect radical solutions -- from Ryan's Roadmap to Huckabee's Fair Tax -- to come to the fore. If Obama doesn't figure out a way to defuse the debt bomb, others will. Right now his presidency is awash in a sea of red ink.
