Dems’ Campaign Budget Vows Five More Years of Spending, Borrowing and Taxing

February 13, 2012

Democrats Double Down on Fiscal Irresponsibility Not Just This Year, But For Four More

President Obama will release his campaign-year budget today, but Americans have seen it before: more of the spending, borrowing and taxing that have defined the last three years of Democrats running Washington. Sadly, the budget looks to be a blueprint Democrats would use to double down on this fiscal irresponsibility for five more years.
This budget highlights the embarrassing hypocrisy of the Democrats’ claims of fiscal seriousness, given the reality of the fiscal disaster Democrats have imposed on America.
The Democrats’ spending addiction is all the more alarming considering that America’s economy remains weak and the nation’s growing debt burden poses a serious threat to job-creation and economic growth. Do Democrats know what they have done?

President Obama will release his campaign-year budget today, but Americans have seen it before: more of the spending, borrowing and taxing that have defined the last three years of Democrats running Washington. Sadly, the budget looks to be a blueprint Democrats would use to double down on this fiscal irresponsibility for five more years:

OBAMA BUDGET “A PLATFORM FOR THE PRESIDENT’S RE-ELECTION”: “But the latest budget document can be seen as more a platform for the president’s re-election campaign than a legislative proposal for budget debates that will begin next week.” (Jonathan Weisman, “Obama Bets Other Concerns Will Trump the Deficit,” The New York Times, 2/11/2012)

BROKEN PROMISES: OBAMA “FALLING FAR SHORT OF HIS GOAL TO HALVE THE DEFICIT IN FOUR YEARS”: “President Obama’s proposed 2013 budget will forecast a $901 billion deficit for next year, falling far short of his goal to halve the deficit in four years.” (Richard Wolf, “Obama Budget to Miss Deficit Goal,” USA Today, 2/10/2012)

A HIGHER DEFICIT THIS YEAR THAN IN 2011: “The budget will show a higher deficit this year than in 2011, up from $1.3 trillion to $1.33 trillion. And the projected decline to $901 billion in 2013 is dependent on enactment of the president’s policies, including spending reductions agreed to last summer and ending George W. Bush’s tax cuts for the wealthy at the end of this year.” (Richard Wolf, “Obama Budget to Miss Deficit Goal,” USA Today, 2/10/2012)

AP: “OBAMA BUDGET: NEW SPENDING WITH RECYCLED TAX IDEAS”: (Andrew Taylor, “Obama Budget: New Spending with Recycled Tax Ideas,” Associated Press, 2/11/2012)

NOT A JOKE: NEW BUDGET IS “LADEN WITH STIMULUS-STYLE INITIATIVES”: “The president’s plan is laden with stimulus-style initiatives: sharp increases for highway construction and school modernization, and a new tax credit for businesses that add jobs.” (Andrew Taylor, “Obama Budget: New Spending with Recycled Tax Ideas,” Associated Press, 2/11/2012)

“UNLIKELY TO RESULT IN A GENUINE EFFORT TO ADDRESS THE $15 TRILLION NATIONAL DEBT”:“Obama’s 2013 budget, set for release Monday, is the official start to an election-year budget battle with Republicans. It’s unlikely to result in a genuine effort to address the $15 trillion national debt or the entrenched deficits that keep piling on to it.” (Andrew Taylor, “Obama Budget: New Spending with Recycled Tax Ideas,” Associated Press, 2/11/2012)

“BUT IT WILL SERVE AS THE DEMOCRATS PARTY-DEFINING TEMPLATE”: (Andrew Taylor, “Obama Budget: New Spending with Recycled Tax Ideas,” Associated Press, 2/11/2012)

This budget highlights the embarrassing hypocrisy of the Democrats’ claims of fiscal seriousness, given the reality of the fiscal disaster Democrats have imposed on America:

A $4.7 TRILLION INCREASE IN NATIONAL DEBT SINCE OBAMA TOOK OFFICE: (“The Daily History of the Debt Results,” TreasuryDirect.Gov, Accessed 2/13/2012)

OBAMA RECORD “THE MOST RAPID INCREASE IN THE DEBT UNDER ANY U.S. PRESIDENT”: (Mark Knoller, “National debt has increased $4 trillion under Obama,” CBS News’ Political Hotsheet Blog, 8/22/11)

NATIONAL DEBT STANDS AT $15.36 TRILLION: (“The Daily History of the Debt Results,” TreasuryDirect.Gov, Accessed 2/12/2012)

SIZE OF NATION’S ECONOMY AT $15.29 TRILLION: (“National Economic Accounts,” Bureau of Economic Analysis, Accessed 2/12/2012)

DEMOCRATS’ RECORD OF TRILLION-DOLLAR DEFICITS: “The Congressional Budget Office on Tuesday predicted the budget deficit will rise to $1.08 trillion in 2012. … The deficit was $1.4 trillion in 2009, $1.3 trillion in 2010 and $1.3 trillion in 2011. The largest deficit recorded before that was $458 billion in 2008.” (Erik Wasson, “CBO Projects $1.08T Deficit, Higher Unemployment,” The Hill, 1/31/2012)

AND WHAT WAS ALL THE SPENDING FOR? 12.8 MILLION AMERICANS UNEMPLOYED: (“The Employment Situation,” Bureau of Labor Statistics, 2/3/2012)

IF U.S. LABOR FORCE WAS SAME AS IN JAN. 2009, UNEMPLOYMENT WOULD BE 11.0 PERCENT:“If the size of the U.S. labor force as a share of the total population was the same as it was when Barack Obama took office—65.7 percent then vs. 63.7 percent today—the U-3 unemployment rate would be 11.0 percent.” (James Pethokoukis, “Why the Official 8.3 Percent Unemployment Rate is a Phony Number—and What It Means for Obama’s Re-Election,” The American, 2/3/2012)

OVER 3 MILLION “MISSING WORKERS” WHO HAVE DROPPED OUT OF LABOR FORCE: “There are currently over 3 million ‘missing’ workers who should be participating in the labor force but are not actively seeking work.” (“Jobs Preview 2012: The Year of the Missing Worker,” HPS Insight, January 2012)

The Democrats’ spending addiction is all the more alarming considering that America’s economy remains weak and the nation’s growing debt burden poses a serious threat to job-creation and economic growth. Do Democrats know what they have done?:

STUDY SHOWS DEFICTS PUT A DRAG ON OUR ECONOMY: “The eventual effect of sustained fiscal imbalance is slower growth and greater risk of a fiscal crisis. Our estimates suggest that a 10-point increase in the debt/GDP ratio lowers growth four years later by 0.2 percentage point, and increases the probability of a debt crisis by 2.5% in the aftermath of a financial crisis like the recent one. (See No Rush for the Exit,” Global Economics Paper, No. 200, June 30, 2010 and “When One Crisis Leads to Another,” US Economics Analyst, 11/04, Jan. 28, 2011.) To avoid this, lawmakers must begin to identify deficit reduction strategies.

“Ultimately, what goes up must come down. In the case of the federal budget, this means that a deficit-financed boost to growth will eventually lead to a drag. While policymakers can try to smooth the transition by phasing in cuts and incorporating multi-year fiscal commitments,achieving a sustainable fiscal policy will inevitably be a painful but necessary process.” (Jan Hatzius and Alec Phillips, “Fiscal Restraint: A Question of When, Not If,” Goldman Sachs Global ECS U.S. Research, 3/2/2011)

MAJOR ECONOMIC STUDY LINKS GOVERNMENT DEBT TO SLOWER ECONOMIC GROWTH: “The sharp run-up in public sector debt will likely prove one of the most enduring legacies of the 2007-2009 financial crises in the United States and elsewhere… Our main finding is that across both advanced countries and emerging markets, high debt/GDP levels (90 percent and above) are associated with notably lower growth outcomes… Seldom do countries simply ‘grow’ their way out of deep debt.” (Carmen M. Reinhart and Kenneth S. Rogoff, “Growth in a Time of Debt,” American Economic Review Papers and Proceedings, 12/31/2009)