Obama’s or­phan is­sue

Pres­i­dent hopes his over­spend­ing habit won’t land on his doorstep

The Washington Times Daily - - Opinion - By Don­ald Lambro

The gov­ern­ment’s mon­strous bud­get deficits con­tinue their me­te­oric rise un­der Pres­i­dent Obama’s big spend­ing poli­cies, fur­ther threat­en­ing Amer­ica’s shaky econ­omy and fu­ture growth.

The Con­gres­sional Bud­get Of­fice last week re­leased a re­vised es­ti­mate of the Obama ad­min­is­tra­tion’s spi­ral­ing deficit, fore­cast­ing it will hit $1.2 tril­lion in the 2012 fis­cal year, which will end a few weeks be­fore Elec­tion Day. This lat­est re­vi­sion pushes the deficit up by an­other $100 bil­lion, and it will likely climb higher be­fore the fis­cal year ends.

This is the fourth straight tril­lion-dol­lar-plus deficit un­der Mr. Obama’s pres­i­dency and the high­est in U.S. his­tory.

He came into of­fice in 2009 with thou­sands of pro­pos­als to spend tril­lions of dol­lars and has run up an­nual deficits to­tal­ing more than $5.2 tril­lion that have pushed to­tal debt to more than $15 tril­lion.

This means the en­tire na­tional debt ex­ceeds our gross do­mes­tic prod­uct, the mea­sure of all the goods and ser­vices we pro­duce each year. In other words, Mr. Obama is spend­ing be­yond our means.

Mr. Obama’s record-shat­ter­ing deficits are as fol­lows: $1.4 tril­lion in 2009; $1.3 tril­lion in 2010; $1.3 tril­lion in 2011; and an es­ti­mated $1.2 tril­lion in 2012.

In 2007, the year be­fore the na­tion’s econ­omy plunged in the Great Re­ces­sion, the fed­eral bud­get deficit was a tame $167 bil­lion. Even in 2008, the first full year of the sub­prime mort­gage de­ba­cle and the last year of Ge­orge W. Bush’s pres­i­dency, the deficit was a man­age­able $438 bil­lion.

But it isn’t just the bud­get deficit that has been climb­ing at a fu­ri­ous pace un­der this pres­i­dent. Gas prices, which were around $1.80 for a gal­lon of reg­u­lar Jan. 1, 2009, have on av­er­age sky­rock­eted to nearly $4 for a gal­lon of reg­u­lar, ac­cord­ing to AAA. The av­er­age price was run­ning $3.52 just a month ago.

But if the pump price isn’t shock­ing enough for you, sharply ris­ing health care costs un­der the new Oba­macare law make the cost of a gal­lon of gas look like a bar­gain in com­par­i­son.

In 2009, Mr. Obama promised the Amer­i­can peo­ple that his man­dated health in­sur­ance plan would cost “around $900 bil­lion over 10 years.”

But the CBO re­ported last week that Oba­macare will cost at least twice that much, or $1.76 tril­lion. And the costs will likely rise in the years to come as the baby boomers grow older.

That’s why Repub­li­cans have be­gun to wage a new po­lit­i­cal as­sault on the un­pop­u­lar Oba­macare law as it reaches the two-year an­niver­sary of its en­act­ment.

“The pres­i­dent promised, ‘If you like your doc­tor or health care plan, you can keep it,’ ” Sen. John Cornyn, the chair­man of the GOP’S Se­nate cam­paign com­mit­tee, says in an Op-ed col­umn for the Austin Amer­i­canS­tates­man.

“In fact, em­ploy­ers have al­ready started drop­ping in­sur­ance cov­er­age in di­rect re­sponse to Oba­macare. The pres­i­dent promised his law would ‘slow the growth of health care costs for our fam­i­lies, our busi­nesses and our gov­ern­ment.’ In­stead, pre­mi­ums for fam­ily cov­er­age rose by 9 per­cent last year.”

Higher costs for gaso­line and health care, along with a weak, high un­em­ploy­ment econ­omy, will be lethal is­sues in the com­ing gen­eral elec­tion, both for Mr. Obama and the Democrats gen­er­ally.

A Gallup poll says the lack­lus­ter Obama econ­omy and the na­tion’s per­sis­tently high un­em­ploy­ment rate are the two top con­cerns Amer­i­cans say will most in­flu­ence their vote for pres­i­dent.

But Mr. Obama’s record bud­get deficits and the na­tion’s grow­ing debt load are at No. 3, with 79 per­cent of vot­ers say­ing the is­sue is ei­ther “ex­tremely or very im­por­tant” in how they will vote in Novem­ber.

Mr. Obama is al­ready out on the hus­tings de­fend­ing his failed pres­i­dency, but he has lit­tle if any­thing to say about his bud­get deficits and the na­tional debt. It’s as if the is­sue does not ex­ist in his po­lit­i­cal think­ing, or he does not think vot­ers will vote on that is­sue.

Mr. Obama’s cam­paign strate­gists hardly touch the deficit and debt is­sues, ei­ther, and you rarely hear Demo­cratic lead­ers in Congress call­ing for ac­tion to bring down the deficit. It is an or­phan is­sue for which no one wants to take re­spon­si­bil­ity. Democrats are fo­cused on more spend­ing, not cut­ting.

In the past three-plus years of this ad­min­is­tra­tion, even when Mr. Obama’s party con­trolled both houses of Congress, Democrats have not passed a bud­get.

The Re­pub­li­can House this week un­veiled its bud­get plan to curb spend­ing and shrink the deficit, but it’s al­ready dead on ar­rival in the Se­nate where Demo­cratic Leader Harry Reid wants to spare his party the dis­com­fort of vot­ing against GOP spend­ing cuts in an elec­tion year.

But this isn’t an is­sue that’s go­ing away. In­stinc­tively, vot­ers con­nect grow­ing deficits and debt as the en­emy of a pros­per­ous econ­omy and ris­ing em­ploy­ment. Eco­nomic an­a­lysts have ar­rived at the same con­clu­sion.

“Ul­ti­mately, what goes up must come down. In the case of the fed­eral bud­get, this means that a deficit-fi­nanced boost to growth will even­tu­ally lead to a drag,” fi­nan­cial an­a­lysts Jan Hatz­ius and Alec Phillips con­cluded in a study last year.

Writ­ing in the “Amer­i­can Eco­nomic Re­view: Pa­pers and Pro­ceed­ings” at the end of 2009, econ­o­mists Car­men M. Rein­hart and Ken­neth S. Ro­goff wrote: “Our main find­ing is that across both ad­vanced coun­tries and emerg­ing mar­kets, high debt/gdp lev­els (90 per­cent and above) are as­so­ci­ated with notably lower growth out­comes.”

The bud­get plan Mr. Obama sent to Congress last month is filled with pre­pos­ter­ous as­sump­tions, such as eco­nomic growth near 4 per­cent that he says will sharply cut the deficit by 2017 when he hopes he’ll be leav­ing of­fice af­ter a sec­ond term.

If you buy that one, says econ­o­mist Peter Morici, Mayor Bloomberg “is sell­ing shares in the Brook­lyn Bridge.”

IL­LUS­TRA­TION BY TIM BRIN­TON

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.