Obama’s Spending Cuts Look More Phony Than Real

Let’s take a look at the spending cuts in the plan the President’s plan.

First, from The New York Times:

Mr. Obama is seeking $1.5 trillion in tax increases, primarily on the wealthy and corporations, through a combination of letting Bush-era income tax cuts expire on wealthier taxpayers, limiting the value of deductions taken by high earners and closing corporate loopholes. The proposal also includes $580 billion in adjustments to health and entitlement programs, including $248 billion to Medicare and $72 billion to Medicaid. In a briefing previewing the plan, administration officials said on Sunday that the Medicare savings would not come from an increase in the Medicare eligibility age.

Second, from National Journal:

Of the $4.4 trillion Obama’s plan shaves from the national debt, $1.2 trillion was already accounted for in the Budget Control Act the president signed in August to prevent a default, according to the White House. The remaining amount includes a $1.1 trillion decrease in defense spending—also previously expected in the execution of the plan to draw down troops in Afghanistan and transition control in Iraq.

So what we’ve got here is:

  • $1.2 trillion in cuts that were already included the legislation passed  in August;
  • $1.1 trillion in expected savings from ending the wars in Afghanistan and Iraq, which was also accounted for in the legislation passed in August;
  • $1.5 trillion in tax increases, assuming that the revenue projections the Administration provides turn out to be accurate; and,
  • $580 billion in spending cuts spread out over Medicare, Medicaid, and other spending programs

So it seems to me that what we’ve really got here is $1.5 trillion in tax increases and $580 billion in actual new spending cuts. This is what the President calls “fair”?

FILED UNDER: Barack Obama, Campaign 2012, Deficit and Debt, Politicians, Quick Takes, Taxes, US Politics
Doug Mataconis
About Doug Mataconis
Doug holds a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010 and contributed a staggering 16,483 posts before his retirement in January 2020.

Comments

  1. john personna says:

    So, we are back to claiming that an expiration of the temporary tax cuts are an unreasonable tax increase?

    How exactly did YOU plan on closing the deficit?

  2. @john personna:

    I’m just noting the President’s rather bizarre take on the word “fair”

  3. Sam says:

    Well, if the AP gets to the truth, this bill is, as Stinky Harry said, Dead on arrival.

    “WASHINGTON (AP) — It’s not just millionaires who’d pay more under President Barack Obama’s latest plan to combat the deficit.

    Air travelers, federal workers, military retirees, wealthier Medicare beneficiaries and people taking out new mortgages are among those who would pay more than $130 billion in new government revenues raised through new or increased fees. These fees are advertised as “savings” in administration budget documents.

    Airline passengers, for instance, would see their federal security fees double from $5 to $10 for a nonstop round-trip and triple to $15 by 2017, raising $25 billion over the coming decade. Federal employees would contribute $21 billion more to their pensions over the same period. Military retirees would pay a $200 fee upon turning 65 to have the government pay their out-of-pocket Medicare expenses. They’d also pay more for non-generic prescription drugs.

    And it’ll cost corporate jet owners a new $100 fee for each flight.

    The fees aren’t taxes. They’re charged to people who use government services or receive benefits like taxpayer-subsidized health care, and the fees typically defray the government’s cost of providing a service. The fee on corporate jets and other private passenger planes, for example, would raise about $1 billion a year to help finance the cost of air traffic control. Recreational flyers won’t have to pay.”
    http://finance.yahoo.com/news/New-government-fees-pepper-apf-4120540659.html?x=0&.v=2

  4. john personna says:

    As I’ve noted before, economic “fairness” extends beyond humans, to other simians. When something is that deep, and biological, I doubt any particular human ideology is going to own it.

    That Obama is making a “fairness” bid is unsurprising, but there is no reason it can’t fly. It just depends on where American humans have their heads at the moment.

  5. Hey Norm says:

    “…$1.1 trillion in expected savings from ending the wars in Afghanistan and Iraq, which was also accounted for in the legislation passed in August…”

    Are you sure finishing the wars that Bush couldn’t are in the Budget Control Act? I know the savings were discussed as part of the Grand Bargain between Obama and Boehner, and in Reid’s plan…but I don’t think they made it into the final legislation. I could be wrong but…

  6. Boyd says:

    @Hey Norm:

    I could be wrong but…

    Fighting…the…snark….aaarghhh!

  7. Hey Norm says:

    @ Boyd…
    Snark away…but an answer at the same time would be useful.
    My impression of the BCA at the time was that it was all targets and no specifics. In fact I think there was a “War on Terror” exemption that included Iraq and Afghanistan.
    Again…I could be wrong but…

  8. Boyd says:

    @Hey Norm: Sheesh, Norm, I was just trying to crack a joke, man! Pass up the Serious Swill and have a shot of the Jolly Juice!

  9. Herb says:

    So it seems to me that what we’ve really got here is $1.5 trillion in tax increases and $580 billion in actual new spending cuts.

    To quote the president, it’s not class warfare, Doug. It’s math.

    In addition to 1.2 trillion in cuts from the mewling infant we call the BCA (seriously, my pile of laundry predates it), we have 1.1 trillion in cuts to defense (after spending how many trillion under Obama’s Republican predecessor), he’s adding $580 billion in cuts to oft-targeted entitlement programs…and you’re still not satisfied?

    He’s making up for about half of that with the tax increase…which everyone says will never happen anyway, so what’s the prob, man?

    That’s almost $3 trillion in cuts and no tax increase. Surely you can be happy with that.