Speaking to House Democrats at their Kingsmill Resort & Spa retreat last month, President Barack Obama defended his economic stimulus plan, claiming: “[We] are not going to get relief by turning back to the same policies that for the last eight years doubled the national debt and threw our economy into a tailspin. … If you’re headed for a cliff, you’ve got to change direction.” Our public policy definitely needs a change in direction. But the Obama Administration’s budget is not a change in direction. Instead, it is a foot on the accelerator taking us off that cliff. Consider:

The only sharp break President Obama takes away from President Bush is the amount of money he takes from the American people. President Bush reduced taxes by approximately $2 trillion; President Obama has proposed raising taxes by $1.4 trillion. Yet even after taking $1.4 trillion more out of the private sector, Obama’s budget still would double the public debt level to $15.4 trillion. Between 2008 and 2013, the budget will add $5.7 trillion ($48,000 per U.S. household) in new government debt. The annual interest on this debt would nearly equal the entire U.S. defense budget by 2019.

How does the Obama budget raise taxes by $1.4 trillion yet still double the national debt? By exploding government spending. Domestic discretionary spend­ing (including stimulus funds) has been hiked over 80 percent over 2008 levels. Even if we set aside the stimulus spending, and take the Obama Administration’s word that all of that spending will be temporary, the expansion of government under Obama’s budget is historic. In 2007, before the recession, Washington spent $24,172 per household. By 2019, the President’s budget would spend $32,463 per household—an inflation-adjusted $8,000 per household expansion of gov­ernment.

Summarizing his findings Heritage Foundation Senior Policy Analyst Brian Riedl writes: “President Obama has framed his budget as a break from the “failed policies” of the Bush Admin­istration. Actually, his budget doubles down on President George W. Bush’s borrow, spend, and bail­out policies.”

Quick Hits:

  • White House budget director Peter Orszag rejected Gov. Mark Sanford’s (R-SC) request for a waiver to use a portion of his stimulus money to pay down the state’s debt.
  • Responding to protectionist measures in the omnibus spending bill, Mexico threatened Monday to impose tariffs on American imports worth at least $2.4 billion.
  • Two “handlers” close to Rep. John Murtha (D-PA) collected nearly $250 million in federal funding for one Pennsylvania firm that then channeled a significant portion of the funding to companies that were among Murtha’s campaign supporters.
  • Stimulus funds for infrastructure are not being spent as fast as the White House planned.
  • Telecom lobbyists are fighting over how the federal government should spend $7.2 billion in stimulus money set aside for new high-speed Internet lines.