Senate GOP leader Mitch McConnell of Kentucky called it “an extreme unbalanced budget that won’t balance in your lifetime or mine.” (He’s 71.) He dismissed it as, “for the most part, just another left-wing wish list.” Which of course it is.
House Budget Committee Chairman Paul Ryan (R-Wis.) said the budget “merely ratified the status quo.” Ryan has produced the last two Republican budgets. The first died because of politically unpopular proposed changes in Medicare. Ryan doubled down on his second budget, which pledged to balance the budget in 10 years, mostly through cuts in domestic spending.
Obama’s budget was aimed at another political leader: House Speaker John Boehner, with whom the president hopes to revive a “grand bargain” on deficit reduction. But Boehner rejected the budget’s proposed tax increases of nearly $1 trillion over 10 years — $580 billion of it from the “wealthy” — saying the $660 billion in tax increases negotiated as part of the “fiscal cliff” deal were enough. “The president got his tax hike in January,” Boehner said.
After four years, the Senate recently passed a budget of its own, one that closely tracks Obama’s, with one key exception: Obama would recalculate the cost-of-living formula for Social Security to slow the increase in benefits (but only by a hair), something most analysts say will have to be done to keep the program solvent. However, many Senate Democrats are outraged that, along with trimming Medicare, Obama would even try to index the formula.
Obama’s budget calls for spending $3.77 trillion in the fiscal year that begins Oct. 1, a relatively modest 2.5 percent increase. Deficit spending — projected at $973 billion for the current year — would fall to $744 billion. It has topped $1 trillion for four consecutive years.
In addition to the tax increases on the “rich,” Obama would close tax loopholes largely available to the wealthy, increase the estate tax (more class warfare, in other words), scale back farm subsidies, eliminate oil and gas production subsidies and increase the tax on a pack of cigarettes by 94 cents, hardly likely to please a tobacco-state representative like McConnell.
All told, Obama’s budget would cut $100 billion each from defense and domestic spending over the next decade. However, it calls for $50 billion in infrastructure spending, $40 billion of which would be spent almost immediately.
And all told, it would include only a tiny $0.6 trillion in deficit reduction over a decade, against spending of $46.5 trillion. And that fractional reduction would be funded by — yes — more tax hikes.
The country deserves better — and Obama should head back to the drawing board.