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Examining Obama’s “Moderate” Budget Proposal

April 25, 2011


President Obama’s budget speech of April 13 may well go down in history as one of the worst Presidential speeches ever broadcast. But it still bears analysis and commentary. While Vice President Biden was sleeping through it, I was taking notes – so here goes. We’ll take Mr. Obama’s most salient statements, and lay them against a plumb line of reality. This may be a lengthy piece – but there is quite a lot to examine.

“This debate over budgets and deficits is about more than just numbers on a page, more than just cutting and spending. It’s about the kind of future we want. It’s about the kind of country we believe in.”

Precisely. This is a battle vision and philosophy. The Big Government, Wealth Redistributing, Nanny State Leftists versus the Self Reliance, Personal Responsibility, Free Market Right.

“From our first days as a nation, we have put our faith in free markets and free enterprise as the engine of America’s wealth and prosperity. More than citizens of any other country, we are rugged individualists, a self-reliant people with a healthy skepticism of too much government.”

Obama throws a bone to the majority of America ! Unfortunately he and the left don’t believe it, as we’ll see in the rest of the President’s remarks!

“Part of this American belief that we are all connected also expresses itself in a conviction that each one of us deserves some basic measure of security. We recognize that no matter how responsibly we live our lives, hard times or bad luck, a crippling illness or a layoff, may strike any one of us. “There but for the grace of God go I,” we say to ourselves, and so we contribute to programs like Medicare and Social Security, which guarantee us health care and a measure of basic income after a lifetime of hard work; unemployment insurance, which protects us against unexpected job loss; and Medicaid, which provides care for millions of seniors in nursing homes, poor children, and those with disabilities. We are a better country because of these commitments. I’ll go further – we would not be a great country without those commitments.”

So, let’s understand: We deserve security at the hand and responsibility of the Federal Government? Do we all deserve compassion? Certainly. Charity? Of course. Family responsibility? Resoundingly, yes. Perhaps even state governments can constitutionally choose to involve themselves in such services. But the enumerated powers granted the Federal Government under our Constitution provide no authority, much less a mandate for any such programs. And Obama thinks that we would not be a great country without entitlements? Does he believe we sucked before FDR?

“For much of the last century, our nation found a way to afford these investments and priorities with the taxes paid by its citizens. As a country that values fairness, wealthier individuals have traditionally born a greater share of this burden than the middle class or those less fortunate. This is not because we begrudge those who’ve done well – we rightly celebrate their success. Rather, it is a basic reflection of our belief that those who have benefited most from our way of life can afford to give a bit more back. Moreover, this belief has not hindered the success of those at the top of the income scale, who continue to do better and better with each passing year.”

Books could be written on this paragraph alone! But I’ll try to be brief. Half the people in this country pay NO Federal Income Tax at all. They are the ones who benefit from this “way of life.” The rich have striven for, worked for, risked for and earned their success, only to have it appropriated for redistribution to those who have not done so! Many of these “beneficiaries” have their homes, heat, food, daycare and many other expenses paid for, and have nicer cars, televisions, cell phones and clothes than many who work hard for their sustenance. Perhaps the “beneficiaries” who now live on government largesse at no expense to them should pay their fair share.

The so called wealthy already pay far more than the lion’s share of taxes. They already see half or more of what they work for taken in Federal, State and other taxes. At what point does confiscation of wealth become UN-fair? The American Dream is that anyone has the opportunity to work hard and become successful. But if you attain that success you become the enemy and your wealth must be confiscated for redistribution to those who did not take the initiative to utilize their opportunities that you did. If you attain the American Dream, do you then deserve to have it taken from you?

“Now, at certain times – particularly during periods of war or recession – our nation has had to borrow money to pay for some of our priorities. And as most families understand, a little credit card debt isn’t going to hurt if it’s temporary.”

Temporary? Our nation has lived on the credit card as a major part of our budget for generations! This isn’t new, and it’s never been “temporary.”

“But as far back as the 1980s, America started amassing debt at more alarming levels, and our leaders began to realize that a larger challenge was on the horizon. They knew that eventually, the Baby Boom generation would retire, which meant a much bigger portion of our citizens would be relying on programs like Medicare, Social Security, and possibly Medicaid.”

The “1980s” and “amassing debt” comment is an implied dig at Reagan. Reagan cut taxes, and was blamed for increasing the deficit. Yet the reality is that Reagan’s tax cuts doubled revenues. It was the Democrat Congress, led by Tip O’Neill, (who declared Reagan’s reasonable budgets “dead on arrival”), which increased spending by $1.84 for every dollar in tax-cut generated new revenue.

Yes, the Dems did see the age-wave of the Baby Boomers coming… and welcomed it as a voter boom. As they aged, they’d become more dependent on Government. The ideal situation for the party of the nanny state.

“To meet this challenge, our leaders came together three times during the 1990s to reduce our nation’s deficit. They forged historic agreements that required tough decisions made by the first President Bush and President Clinton; by Democratic Congresses and a Republican Congress. All three agreements asked for shared responsibility and shared sacrifice, but they largely protected the middle class, our commitments to seniors, and key investments in our future.”

“As a result of these bipartisan efforts, America ’s finances were in great shape by the year 2000. We went from deficit to surplus. America was actually on track to becoming completely debt-free, and we were prepared for the retirement of the Baby Boomers.”

This is almost laughable!

Prior to the Gingrich revolution of 1994, the Democrats had a death-grip on Congress, where budgets/spending take place. Interestingly, starting in 1994, we saw deficit reduction fiscal responsibility under the GOP majority that lead to a couple years of actual surpluses which, of course, Bill Clinton took credit for, though he was dragged kicking and screaming by the GOP Congress to budgets of austerity. And now Obama’s claiming it to have been a bi-partisan effort!

“But after Democrats and Republicans committed to fiscal discipline during the 1990s, we lost our way in the decade that followed. We increased spending dramatically for two wars and an expensive prescription drug program – but we didn’t pay for any of this new spending.”

It wasn’t until the perfect storm of the dot-bomb, 9/11, and the prosecution of 2 wars that we had to pick up that credit card again! Bush’s worst deficit (and the worst deficit in history to that point) was in 2003, at $420 Billion (a mere pittance by today’s standards).

The “dramatic increase” for 2 wars: Remember the $87 Billion that Kerry voted for before voting against? We ran 2 wars for a year on $87 Billion. Remember the $787 Billion Bailout? That was 9 times bigger.

The Bush Tax Cuts (that Obama wants to roll back, as we’ll discuss later) did what tax cuts always do… they raised revenues! Our deficit declined in each of the following 3 years, so that when the power shifted back to the Democrats in 2006, the deficit had been reduced to a mere $120 Billion. The Bush tax cuts reduced the deficit by $300 Billion in 3 years – or about $100 Billion a year.

Bush took office with our national debt at $4 Trillion. He and the GOP Congress were deservedly criticized for increasing that by 50% to $6 Trillion in the first 6 years of the Bush Administration. Bush raised the debt by $2 Trillion in 6 years, and was “rewarded” with the return of power to the Democrats and Pelosi and Reid took the helm of Congress.

Unfortunately, as bad as Bush’s fiscal leadership had been… it was exponentially better than what followed. In their first year, Pelosi/Reid tripled the previous year’s $120 Billion dollar deficit to $450 Billion – $30 Billion worse than Bush’s worst deficit in 2003. But the following year, they tripled that to $1.2 trillion. Pelosi and Reid started their tenure in charge with a $120 Billion dollar deficit and $6 Trillion in debt. In merely 4 years they increased the deficit exponentially, to $1.6 Trillion (1600 Billion) and they raised our debt by 2 1/3 times to $14 Trillion! It took 43 Presidents and 230 years to amass a 6 Trillion dollar debt… and these clowns added $8 Trillion to it in 4 years!

Copyright ©2011 Doug Edelman

 


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