Initial Talking Points on CBO Scoring of Obama Budget

Posted March 20th, 2009 at 2.34pm in Ongoing Priorities.

• President Obama’s budget presented at the end of February painted a picture of a fiscal trainwreck. The Congressional Budget Office (CBO) today confirmed what many had suspected – the fiscal consequences of the President’s policies would be much worse.

• The President is calling for massive tax increases equal to about $150 B a year by 2019.

• He raises taxes not just on upper-income taxpayers as he promised, but on all Americans through his misnamed “climate revenues”, and as his budget indicates, this is just a starter program.

• The President calls for enormous increases in government spending on health care and climate change, but on a great many other programs. By 2019, spending would be almost $1T higher per year than if spending stayed at its historical level.

• The CBO saw through perhaps the greatest chicanery ever in federal budgeting when President Obama first assumed the full costs of the operations in Iraq and Afghanistan in perpetuity, and then claimed he is cutting spending when he asserts a change in policy and those spending amounts disappear.

• As a consequence of these two, the record-breaking budget deficits and government debt outlined in the President’s Budget are going to be far worse, according to CBO.

• Under Obama’s budget, the national debt will increase by more in two years than it did under President Bush in eight years.

• The national debt will increase by $4.9 T due to the President’s policies.

• Bottom line – much higher taxes, vastly higher spending, a deficit after the economy has recovered of almost $1.2T.

• President Obama has inherited and economic and fiscal mess as he asserts. His policies would make the economic situation worse, and he has faced the fiscal mess and decided to double down.

• To some extent there are always disagreements between the CBO and the Administration on economics, baselines, and policy consequences. Neither side has a monopoly on the truth. But the differences presented by the CBO go far beyond matters of professional disagreement.

Key Facts:

1) Budget deficit expected to reach $1.8T in 2009, more than 3 times the previous record of $459 billion set in 2008.

2) As a share of the economy, the deficit will be 13.1 percent of GDP, more than twice the previous post-War record.

3) Cumulative deficits over the next ten years will total $9.3T, over half of which ($4.9T) is due to the President’s policies.

4) Revenues reach 18.9 percent of GDP (based on rough approximation of climate revenue program), much higher than historical average of 18.2 percent.

5) Spending reaches 24.5 percent of GDP, far higher than the post-war average of about 20.2 percent.

Author: J.D. Foster
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9 Comments

March 20, 2009 lauren writes:

why have i not seen any comments on the slight of hand that is happening before our eyes? all the above comments are true, but NO ONE seems to be paying attention to what “the other hand” is doing! it’s a magic show and we are all focused on the wrong hand.

March 20, 2009 JohnR, Washington, DC writes:

Reports are that the budget is being prepared for House action next week. If it is presented as a package, under a closed rule, it will pass the House no matter what the CBO says.

Pres. Obama’s plans for a North American version of the Bolivarian revolution will then have taken a big step toward realization just weeks into his administration. While there may be changes made at the margin in the House and Senate, the behemoth’s prompt enactment largely as presented will be likely under current Democratic leadership plans.

Opponents should demand that the process be opened up and that deliberations be prolonged. There’s plenty to focus on, but producing white papers about this or that aspect of the budget will be useless if the train has already left the station. It just might, next week.

March 20, 2009 Randy Tagg, San Diego writes:

The real (on-going)tragedy for America ….
is the nationwide epidemic of public apathy that keeps all of our Washington “representatives” in their positions of public trust, term after term, and out of jail.
Sad.

March 20, 2009 B in Michigan writes:

ARE YOU ANGRY/SCARED/SICKENED/DISILLUSIONED/FEELING BETRAYED/HELPLESS/READY TO KICK-ASS?

THE PLOT THICKENS AND GROWS MORE PERVASIVE. NOW WE ARE 1.8 TRILLION IN DEBT AFTER THE BOY-PRINCE OPENS OUR POCKETS AND PICKS THEM CLEAN.

IS THIS A RAMPING UP TO GETTING US TOTALLY UNDER THE CONTROL OF THE GOVERNMENT AND THEN EXECUTE A FAKE-OUT BY PULLING THE RUG OUT FROM UNDER US LATER? SEEMS STRANGE THAT BOY-PRINCE IS SO DISCONNECTED TO THE PROBLEMS WHILE HE CAVORTS ON TV.

March 21, 2009 S in PA writes:

This BHO administration is leading us to a $11 Trillion Debt, a sick and defensively weak country, a USA owned & controlled by foreign countries —– we the people must not let this happen!!!

March 22, 2009 CBO: Budget adds 4.8 trillion to national debt, China worried « Wintery Knight Blog writes:

[...] Heritage Foundation blog The Foundry has more. Here are just a few of their bullet points: • He raises taxes not just on upper-income taxpayers [...]

March 23, 2009 Pam Albany GA writes:

While his brown shirts go door to door strong arming, Peebo smiles and trashes the economy. Welcome to the future.

July 8, 2009 The Obama Economy is Failing « Conservative Thoughts and Profundity writes:

[...] Under Obama’s budget, the national debt will increase by more in two years than it did under Presi… [...]

July 14, 2009 B In Michigan writes:

Oh Boy… the other shoe is dropping. A second Stimulus Package is now in the offing. I am sick to death of the Boy Prince and his never letting a good crisis go to waste. At least his approval ratings are dropping so the apathetic Right is getting on board. People are starting to pay attention now…a bit too late but, at least they are starting to pay attention.

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