Trillion Dollar Deficits as Far as the Eye Can See
Remember that balanced budget we were going to get? Not so fast.
President Barack Obama‘s budget would generate deficits averaging almost $1 trillion a year over the next decade, according to the latest congressional estimates, significantly worse than predicted by the White House just last month. The Congressional Budget Office figures, obtained by The Associated Press Friday, predict Obama’s budget will produce $9.3 trillion worth of red ink over 2010-2019. That’s $2.3 trillion worse than the White House predicted in its budget.
A trillion here, a trillion there . . .
Worst of all, CBO says the deficit under Obama’s policies would never go below 4 percent of the size of the economy, figures that economists agree are unsustainable. By the end of the decade, the deficit would exceed 5 percent of gross domestic product, a dangerously high level.
The latest figures, even worse than expected by top Democrats, throw a major monkey wrench into efforts to enact Obama’s budget, which promises universal health care for all and higher spending for domestic programs like education and research into renewable energy. The dismal deficit figures, if they prove to be accurate, inevitably raise the prospect that Obama and his allies controlling Congress would have to consider raising taxes after the recession ends or paring back his agenda.
As Dave Schuler likes to say, that which is unsustainable won’t be sustained. Of “raising taxes” and “paring back his agenda,” I think we all know which a Democratic president and Democratic Congress will pick. Hell, it’s what a Republican president and Republican Congress picked for six years.
But without referencing the figures, Obama insisted on Friday that his agenda is still on track. “What we will not cut are investments that will lead to real growth and prosperity over the long term,” Obama said. “That’s why our budget makes a historic commitment to comprehensive health care reform. That’s why it enhances America’s competitiveness by reducing our dependence on foreign oil and building a clean energy economy.”
Asked and answered.
To be sure, these long range estimates are absurd flights of fancy. Even the most honest and expert forecasters couldn’t tell you with any accuracy what 2019’s revenue is going to be within half a trillion dollars. So, we’re working with fantasy numbers either way.
Still, the best guess from the beginning has been that Obama was operating from budget numbers that were complete BS incredibly optimistic. He isn’t the first president to do so nor will he be the last.