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Obama's Budget Includes $800 Billion Tax Hike, $7.3 Trillion in New Debt

3:21 PM, Apr 5, 2013 • By DANIEL HALPER
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The Republican side of the Senate Budget Committee is breaking down President Obama's budget with this preliminary analysis:

The budget will be released next week "The figures regarding the President’s plan are based on numbers reported in the media today, the table posted on the White House (WH) website, and information regarding Senator Murray’s budget resolution," says the minority side of Senate Budget Committee.

"Senator Murray, in touting her budget, talks about $4 trillion in deficit reduction, but that figure uses baseline gimmicks to exclude the cost of turning off the sequester, and the assumptions that the annual doc fix and continuing the 2009 stimulus does not need to be paid for.  The $1.3 trillion cost for those items are CBO estimates included in the Murray budget.  Because the media also reports that the president plans to cancel the sequester, it is reasonable to conclude that the President will have the same costs buried in his baseline as well since Obama also talks about $4 trillion in deficit reduction. 

"The taxes figure is the $600 billion in tax hikes admitted to by the President in today’s leaks, plus the $100 billion from the CPUI change noted on the WH website, and $100 billion for tobacco taxes to pay for universal pre-K.  We don’t know what the President’s exact proposal will be, but we know those taxes can be set to hit whatever number the President needs to pay for his pre-K policy.  The media today reports that the president will raise tobacco taxes to pay for universal pre-K.  We know from earlier reporting  that the President’s pre-K plan could cost between $10 and $25 billion, so $100 billion over 10 years is a reasonable number for the first 10 year cost of the program, and the new taxes needed to pay for it.

"The stimulus number comes from the WH table, as does the savings figures. 

"Debt numbers must be lower than the president’s table because he is showing interest on the gross savings, but not the net savings.  If interest savings are estimated to be $200 billion on $1.8 trillion in deficit reduction, they would be slightly below $30 billion on $250 billion in deficit reduction.  The $30 billion rounds up to the President’s benefit."

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