Feb 14, 2011
Two things to consider as you read about President Obama’s budget request, which calls for record deficits next year but also includes more than $1 trillion in cuts over the longer term. First, as a lot of commentators are pointing out, the budget doesn’t address the biggest sources of our mounting national debt, namely the rising health care costs and aging population that are going to drive up spending on Medicare, Medicaid and Social Security. Secondly, the budget request is a starting point. Congress doesn’t have to enact any of it, and in fact last year didn’t pass a budget at all. This is where the debate starts. Where it will end, we don’t know. But it’s worth remembering that the longer we wait to deal with the real issues driving the budget, the harder it’s going to be to solve them.
What’s Actually in the Budget
In the federal budget debate, brevity is always a relief, so here’s White House budget director Jacob Lew’s three-minute version of the budget request, on the White House Whiteboard:
At the other end of the scale, if you want every possible detail, the full budget request is posted at the Office of Management and Budget. The Washington Post’s Federal Budget page rounds up a lot of useful coverage.
What It Does, What it Doesn’t Do, and Why
“Calvin Coolidge once said that the business of America is business. Well, the business of the American government is insurance. Literally. If you look at how the federal government spends our money, it’s an insurance conglomerate protected by a large standing army. But you wouldn’t know it to listen to the debate over the budget…
“The budget ends up like the yard of a man who owns only a lawnmower: The grass is trim, but the trees are overgrown and the ivy is everywhere and the gazebo is falling apart. Yet we keep mowing, because that’s what we feel able to do.”
There’s a reason why Obama’s budget is structured this way, writes Jackie Calmes in The New York Times, in “A Cautious Approach Seeking Bipartisan Appeal”:
“That decision partly reflects Mr. Obama’s characteristic caution, but also a White House calculation: that “now” is too soon for the nation’s political system. And that boldness could backfire — wounding not just a president facing re-election next year but also the prospects for bipartisan agreement on the very tax and spending-cut proposals that all sides realize are needed to truly stem the projected red ink in a nation confronting high health care costs and an aging population.”
Even before today’s announcement, the budget was getting criticism for ducking those long-term problems. But the White House says its proposal does incorporate some fiscal commission ideas
“[Budget director Jacob] Lew defended the White House on CNN’s “State of the Union” on Sunday, arguing that the fiscal commission had “a very significant impact” on the president’s budget blueprint. The spending plan incorporates “many, many ideas” developed by the commission, he said, including proposals to limit awards in medical malpractice lawsuits, overhaul the corporate tax system and freeze pay for federal workers.”
EconomistMom calls this “a budget fitting for Valentine’s Day” because:
“I think it’s a fitting “Valentine’s Day” budget because it only pays “lip service” to the work of the President’s fiscal commission, writes a lot of “love notes” to those enduring Bush/Obama tax cuts, and still contains an awful lot of red ink.”
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Fiscal Future Daily is produced by Public Agenda for Choosing Our Fiscal Future, in partnership with the National Academy of Public Administration and with support by the John D. and Catherine T. MacArthur Foundation. The editor in chief is Scott Bittle, with contributors Francie Grace, David White, Jen Vento, Hart Hooton and Tom Watson.