by Mike Griffith, Staff Writer

When it comes to the federal budget, President Obama is shaping up to be even worse than George W. Bush.  During the election campaign, Obama justifiably criticized Bush for nearly doubling the national debt in eight years.  Yet, President Obama’s proposed budget would continue Bush’s reckless borrow-and-spend approach on an even bigger scale.

To call President Obama’s budget proposal disturbing is to be charitable.  To say that it contains assumptions that are simply incredible is to put it mildly.  Here are some of the more problematic aspects of the president’s proposed budget:

* According to a report released today by the bipartisan Congressional Budget Office (CBO), the Obama budget would generate deficits of nearly $1 trillion a year over the next ten years.  This is markedly worse than the deficits predicted by the White House just last month.  The CBO predicts the Obama budget will produce $9.3 trillion in deficit spending from 2010-2019. That’s $2.3 trillion more than the Obama budget predicts. 

Even worse, the CBO concludes that the deficit under Obama’s budget would never drop below 4% of GDP, a percentage economists agree is unsustainable.  By 2019, according to the CBO, the deficit would be more than 5% of GDP, a dangerously high level. 

* The Obama budget calls for a massive increase in spending in the first year alone, taking us from $3.1 trillion to $3.5 trillion (actually nearly $3.6 trillion).  That’s an increase of nearly 16%, in just one year, at a time when we’re already $11 trillion in debt and running a huge deficit.  What happened to Obama’s campaign promise that under him there would be a net reduction in federal spending?

* The Obama budget calls for a truly staggering increase in federal spending over ten years, taking us from the first year amount of $3.5 trillion up to $5.1 trillion.  That’s an increase of 70%. 

* Although the Obama budget calls for a 70% spending increase from 2009 to 2019, it ridiculously assumes that the budget would drop as a share of GDP.  It assumes the budget would go from 24.1% of GDP down to 22.6% of GDP.  But even this “drop” is an illusion.  Why?  Because even if Obama’s fanciful projections pan out, the federal budget would still consume more of GDP than it did just a few months ago.  The 2008 budget was 20.7% of GDP.  So, assuming for the sake of argument that Obama’s very rosy projections come true, the government would still be consuming 22.6% of GDP by 2019 vs. 20.7% in 2008.

* The Obama budget actually admits that it would balloon the cost of the national debt, i.e., that it would more than double what we have to pay just in interest on the national debt.  Interest on the national debt currently accounts for about 8% of the budget and costs $249 billion.  Under the Obama budget, by 2019 interest on the debt would consume 12% of the budget and cost $662 billion.  So in terms of what we would have to pay on the debt, the amount would more than double, going from the current cost of $249 billion to $660 billion.

* The Obama budget calls for $1.6 trillion in new taxes and $940 billion in new tax cuts, for a net increase in taxes of $660 billion.  Some experts contend that with Obama’s other proposed tax hikes on energy and investments, the net tax increase would be considerably greater.  Yet, it’s clear that the problem isn’t taxes.  The problem is runaway federal spending.  Not once in the last forty years has there been a reduction in total federal spending—not once.  Every single year for the last forty years overall federal spending has increased.  Furthermore, during every administration since JFK, federal tax revenue has actually gone up, even after significant tax cuts.  So the problem isn’t that we aren’t being taxed enough.  The problem is that the federal government continues to spend too much money.     

President Obama’s budget is a recipe for vastly increased spending, more debt, more taxes, and a sluggish economy.

For more information, see:

The President’s Budget: A Bold Approach with Many Risks

http://www.concordcoalition.org/files/uploaded_for_nodes/docs/Obama_budget.pdf

The Obama Budget: Spending, Taxes, and Doubling the National Debt

http://www.heritage.org/Research/Budget/bg2249.cfm

U.S. Budget Deficit Forecast to Hit $1.8 Trillion This Year

http://www.foxnews.com/politics/first100days/2009/03/20/budget-deficit-forecast-hit-trillion-year/

ADDITIONAL SOURCES:

Here are some other credible sources that call attention to the fact that President Obama’s proposed budget contains unrealistic projections and that it would increase the deficit, add to the national debt, and raise taxes:

From The Wall Street Journal:

Big Deficit Projection Tests Obama Agenda
http://online.wsj.com/article/SB123755932558295685.html?mod=article-outset-box [online.wsj.com]

From Investor’s Business Daily:

How Obama’s Soak-the-Rich Plan Will End Up Hurting the Middle Class
http://www.ibdeditorials.com/IBDArticles.aspx?id=320976715882037 [www.ibdeditorials.com]

Capping Economic Growth
http://www.ibdeditorials.com/IBDArticles.aspx?id=321149974392278 [www.ibdeditorials.com]

From The Independent Institute:

Budgetary Obamanomics
http://www.independent.org/newsroom/article.asp?id=2452 [www.independent.org]

From The Economist:

Barack Obama’s Budget: Wishful, and Dangerous, Thinking
http://www.economist.com/opinion/displayStory.cfm?STORY_ID=13237211 [www.economist.com]