2012 Federal Budget: Obama Proposes $1.33 Trillion In Deficits – Games The Administration Play
The White House has released their proposal for the Federal Budget for 2012. Before we discuss the 2012 budget, harken back to President Obama saying in 2009 that he will CUT the deficit in half by the end of his first term. His first term ends in January 2013, so he has less than a year to accomplish his promise.
According to The Federal Reserve, these are the recent budget deficits. Obama needs to reduce the 2009 budget deficit by 50% to -$700,000 million by the end of 2012.
And here is a chart of the history of the budget deficit so you can see how utterly out of control Federal government spending has been since 2008.
The projected deficit for 2012 is forecast to be $1.33 trillion, 2.6% higher than the $1.296 trillion deficit in 2011 and 16% higher than the $1.15 trillion projection released by the Congressional Budget Office (CBO) last week. This is a far cry from Obama’s promise of cutting the deficit by $700 billion. In fact, it is almost twice what he promised in the wrong direction. He is INCREASING the deficit.
The budget includes more than $350 billion in short-term measures for job growth; a six-year, $476 billion proposal for roads and other surface-transportation projects; and more than $360 billion in savings in health programs such as Medicare and Medicaid. Bear in mind that some of those savings are simply that Obamacare will cause private healthcare insurance premiums to skyrocket – see here).
The request also includes $850 million for Mr. Obama’s “Race to the Top” competition for education.
There are billions of dollars for loan guarantees, safety nets, education and infrastructure spending (bridges and bad roads need to be repaired).
Now for the bad part. The budget proposal repeats a call for $1.5 trillion in new revenue, mostly from ending Bush-era tax cuts for families earning more than $250,000 a year. So, if there are no new taxes, the budget deficit would be $1.33 trillion. With the tax increases, the budget deficit will be $575 billion in 2018.
What is stunning about this budget proposal is that the Obama Administration gets to “cutting the deficit in half” in 2018 rather than 2012.
And by the end of 2013, our debt to GDP ratio will be 110%. Our Federal debt since 2008 has been on an unsustainable trajectory and the deficit increase by President Obama’s is driving another nail in our fiscal coffin.
Well, we are beating Socialist France at the massive entitlement, spending and debt derby.
The most stunning revelation of the budget is the continuation of the massive spending binge without tackling the horrific entitlement problems looming on the horizon. Instead, the budget is loaded with the same green energy boondoggles, more funding to failed education systems, and infrastructure spending (roads and bridges). One a micro level, the budget is filled with appalling expenditures like a $1 billion dollar increase for tabulation of the Census, $325 million for Agriculture research, and other mind boggling expenditures.
Of course, the housing and mortgage fiasco receives some ink. However, the budget has a very optimistic forecast for the continued losses to the mortgage giants in conservatorship, Fannie Mae and Freddie. It forecasts that further losses to taxpayers will actually decline to $73 billion from the current loss to taxpayers of $131 billion. Only this Administration would brag about government sponsored enterprises losing “only $73 billion.”
But my biggest concern is the lack of discussion of the myriad of government mortgage refinance programs like HAMP, HARP, the Attorney General settlement (coordinated with the Administration) and the proposed FHA refi plan outlined in the President’s State of the Union address. These programs are likely to generate massive costs to taxpayers since mortgage refinancings are paid by mortgage-backed security (MBS) investors like The Fed, Fannie Mae and Freddie Mac, yet they receive little attention from The Administration.
Despite the pledges of reducing the deficit, the Administration is relying on their tired “tax the rich!” mantra to reduce the deficits, despite the fact that just less than 50% of taxpayers pay little or no Federal income taxes.
Given the Administration’s track record with Solyndra, the Chevy Volt and other fiscal debacles, I can easily see the massive increase in infrastructure spending going to the same green growth boondoggles that have plagued the Administration. Here is a sampling of the Administration’s green, big city redevelopment proposals:
“Improves public housing and revitalizes surrounding neighborhoods by providing $250 million to continue HUD’s transformative investments in high-poverty neighborhoods where distressed HUD-assisted public and privately owned housing is located.”
“Invests in sustainable, innovative communities by providing $150 million to create incentives for more communities to develop comprehensive housing and transportation plans that result in sustainable development, reduced greenhouse gas emissions, and increased transit-accessible housing.”
“Provides more than $2.5 billion to continue progress toward the Administration’s goal to end chronic homelessness and homelessness among veterans and families, implementing an innovative, multi-agency strategic plan.”
And so on. Hey, how about lowering taxes, reducing EPA iron hand tactics and various regulations hand-cuffing the economy and job growth? We know that would work, but it would take away from Big Government’s “Iron Hand” policies. After all, their economists know what is best for us. (NOT!)
We have spent trillions in the last two decades on helping home ownership and government-directed inner-city investments. Yet we still see little progress on this front.
In summary, this budget harkens back to the classic ’60s rock/country song by Joe South, Freddie Weller and others called “Games People Play.” Except that a new version should be recorded called “Games The Administration Play.” It would fit this budget proposal perfectly: its all games, not a serious effort to govern, balance the budget, reign in entitlement spending or reduce the deficit.
“Oh the games people The Administration play now
Every night and every day now
Never meaning what they say now
Never saying what they mean
And they wile away the hours
In their ivory towers (Cass Sunsteen, Austan Goolsbee, Larry Summers, Christina Romer, Elizabeth Warren, etc.)
Till they’re we’re covered up with flowers (cradle to grave entitlements)
In the back of a black limousine.
Chorus
La-da da da da da da da
La-da da da da da de
Talking ’bout you and me
And the games people The Administration play
Oh we make one another cry
Break a heart then we say goodbye
Cross our hearts and we hope to die
That the other was to blame (Congress and specifically House Republicans)
Neither one will give in
So we gaze at our eight by ten
Thinking ’bout the things that might have been
It’s a dirty rotten shame
Repeat Chorus
People walking up to you
Singing glory hallelulia
And they’re tryin to sock it to you (Obamacare, Dodd-Frank, EPA mandates, tax the “rich”, ignoring The Constitution)
In the name of the Lord (Jesus would want to raise taxes on the rich and give to the Romans – funny, I missed that part of The Bible!)
They’re gonna teach you how to meditate (or community organize)
Read your horoscope, cheat your faith (requiring Catholic organizations to fund contraceptives against their will)
And further more to hell with hate
Come on and get on board
Repeat Chorus
Look around tell me what you see
What’s happening to you and me
God grant me the serenity
To remember who I am (an individual, not part of a Utopian collective)
Cause you’ve given up your sanity (not to mention personal freedom)
For your pride and your vanity
Turns you sad on humanity
And you don’t give a da da da da da “
Hey, Joe South actually understood The Obama Administration back in the 1960s!
Here is Freddie Weller’s (former guitarist for Paul Revere and the Raiders) version of “Games People Play.” The real Paul Revere would likely approve of the update version.
