Amidst the excitement in Egypt and in Wisconsin Timothy Geithner offered long-overdue testimony to Senate Budget Committee and his words were frightening.
Barack Obama has claimed that his budget was responsible.
“What my budget does is to put forward some tough choices, some significant spending cuts so that by the middle of this decade our annual spending will match our annual revenues. We will not be adding more to the national debt.”
No matter what Obama says, his plan dooms us.
New press secretary Jay Carney claimed that Obama’s budget would “cut” $400 billion, which was of course not true. Obama cut nothing. Spending freezes are freezes, not cuts. Once again Barack Obama votes present. He ducks the issue, he avoids responsibility. He won’t make the hard choices. I don’t believe he has the guts to make really the tough choices.
It might interfere with his golf game.
Last year Peter Orszag decided that the Obama administration would set a goal of balancing the “primary budget” which bascially means ignoring the interest on the debt. As noted, the better decision would be to stabilize the debt as a function of GDP.
Balancing the primary budget is a mockery, a joke meant to bamboozle the leaner of intellects, i.e. liberals.
A balanced budget means government revenues and spending are roughly equal. But a budget in “primary balance,” according to the Obama administration, occurs when revenues and spending are equal — excluding all the interest the government pays on its enormous debt.
President Obama projects the budget will reach “primary balance” in 2017, when government revenues and spending will both be about $4 trillion. Problem is, the White House predicts interest on the debt that year will be $627 billion. So even though the budget will be in “primary balance,” there will in fact be a deficit of $627 billion. “Primary balance” is no balance at all.
By 2021, the White House projects interest payments will reach $844 billion, which is a lot of money to ignore.
In testimony before the Senate Budget Committee Sen. Jeff Sessions (R-AL) remarked that under the Obama budget plan interest payments will rise from $187 billion in 2009 to $844 billion. Geither responded
“You’re absolutely right that with the president’s plan, even if Congress were to enact it, and even if Congress were to hold to it and reduce those deficits to three percent of GDP over the next five years, we would still be left with a very large interest burden and unsustainable obligations over time.”
Obama’s position left many shaking their heads:
Just for the record: The government cannot run budget deficits of, say, $627 billion, or $844 billion, and not add to the national debt. Interest payments have to be made. Obama’s words were so egregiously wrong that the watchdog website PolitiFact quickly labeled them false. “We think the president’s statement is likely to mislead a lot of Americans about what his budget would do,” PolitiFact wrote.
The whole line of argument left Sessions amazed. “We add more under [the president’s] plan to the national debt every single year,” Sessions said Wednesday. “So how could this possibly be a position in which you will not be adding more to the debt? What world are we living in?”
At American Thinker, Robert Santorski asks a question for all of us
Who knew that we didn’t have to count interest in our budgets? This is good news for all of us who carry balances on our credit cards or have mortgages. Interest payments don’t count. Sweet! I don’t think the banks will be too happy about this, or the Chinese in the case of our national debt, but if it’s good enough for the President, it’s good enough for me. It would be helpful if Mr. Obama would just provide us with a note we can give to our bankers stating that interest doesn’t matter, so there’s no confusion when we refuse to make our monthly payments.
The answer is yes, Obama thinks America is stupid and why not? The 53% who voted for him validate his belief.
What Obama is doing is washing his hands of responsibility for the country and putting himself first once again.
Meanwhile, Democrats are sticking their heads into any dark orifice they can find in order to avoid the painfully obvious truth- entitlements have to be reformed.
The demands of Obamacare on Medicaid are a cold shower for Governors who see the financial tsunami building as it bears down upon them.
Sebelius is under heavy pressure to work with states, which are faced with great fiscal strain and worry about the healthcare reform law’s requirement that Medicaid cover everyone — even childless adults — up to 133 percent of the Federal Poverty Level. Last month, 33 governors and governors-elect wrote to Sebelius requesting that she lift the reform law’s so-called maintenance of effort (MOE) requirement, which restricts states’ ability to cut their Medicaid rolls ahead of the expansion in 2014.
“States are unable to afford the current Medicaid program, yet our hands are tied by the MOE requirements included in the [reform law],” they wrote. “The effect of the federal requirements is unconscionable; [they] force governors to cut other critical state programs, such as education, in order to fund a ‘one-size-fits-all’ approach to Medicaid.”
The Obamacare monster sinking its teeth into him has even attracted the attention of Andrew Cuomo:
One under-reported story of 2011 is the revolt of the Governors, who are looking in horror at ObamaCare’s permanent expansion of Medicaid and begging Washington for more flexibility. The White House is telling them to kiss off, though less expected is that many of the rebels are Democrats.
Look no further than Andrew Cuomo, New York’s new chief executive. Over the years the Empire State has expanded this joint state-federal program originally meant for poor women and children deep into the middle class—much like the model the 2010 health bill will impose on all states in 2014. Mr. Cuomo’s ambitious reform plan runs in the opposite direction, and little wonder. Spending for this $53 billion-plus program in New York will increase automatically by 13% this year even as Mr. Cuomo must close a $10 billion deficit.
Ironically, Cuomo will be face opposition to any meaningful changes by the cronies he stocked into his Medicaid commission:
Mr. Cuomo has stocked his Medicaid commission with political blue ribbons who benefit from the status quo—members include the major New York provider lobbyists, Dennis Rivera of the SEIU and Assemblymen chosen by Albany leaders. One danger is that the price of their buy-in will be to smother the major changes the program needs and Mr. Cuomo says he favors, especially once the modern-day Boss Tweeds get a look at concrete proposals.
And New York has a history of subsidizing SEIU at the cost of everyone else.
The loathsome Sen. Chuck Schumer (D-NY) has already raised the canard of government shutdown and it being the fault of Republicans.
“Unfortunately, Speaker Boehner seems to be on a course that would inevitably lead to a shutdown,” Schumer said Sunday morning on CNN’s “State of the Union.” “That’s reckless … and I hope he’d reconsider.”
Fortunately, government can’t spend any money when it is shut down so maybe it’s not all bad.
Then again, on what leg are Democrats standing when the argue that government shutdown is bad after having shut down the government in Wisconsin?
Now the budget crisis is much, much worse than it was in 1996 — Obama and Congressional Democrats added $4 trillion to the deficit in just over two years. I don’t think the magnitude of our current fiscal problems are lost on voters. And the more Congressional Democrats ratchet up the rhetoric towards the House GOP over the shutdown, the more they’re liable to be called out as rank hypocrites following right on heels of the Democratic temper tantrum in Wisconsin.
Causing a government shutdown may still be a risky gambit for Republicans, but it will be very hard for Democrats to make the case against it with any moral authority and stir up voter sympathy.
Barack Obama exploded the deficit and now Dr. Obama will try to cure the disease he created. Democrats are like like drug addicts and money is their crack. We have a President who won’t take his job seriously and Democrats who won’t believe that the money supply does actually have a limit.
When it all fails, I do know where Obama can get a doctor’s note for everyone.