“This reaffirms what has become all too apparent: the president has no interest in doing anything, even modest, to address our looming debt crisis”
–Brendan Buck, a spokesman for House Speaker John Boehner
Legacy: Barack Obama came into the White House in 2009 promising a “new era of responsibility.” What he’s left President Trump is a government careening toward fiscal ruin.That’s what the latest report from the Congressional Budget Office shows.
The CBO report looks at what federal spending and revenues will look like over the next decade if the government is left on autopilot. The picture is grim.
Deficits this year are expected to be $559 billion. By 2023, the government will once again be running trillion-dollar annual deficits that will quickly climb in the following years.
Left unchanged, the national debt will worsen by an additional $10 trillion in a decade, equaling almost 90% of the economy.
And that’s despite the fact that, thanks to Obama’s multiple tax increases, revenues are on track to consume more than 18% of the nation’s economy, which is a full percentage point above the average since 1967.
Spending, however, is completely out of control. It’s set to climb from 20.5% of GDP next year to 23.4% by 2027. The post-1967 average was 20%.
ObamaCare subsidies alone will, according to the CBO, climb 22% this year and 20% the next — thanks to the massive increase in premiums. This cost explosion is in addition to the vast increase in Medicaid spending ObamaCare already generated. And it’s all on top of fast-growing Social Security and Medicare, both of which are rapidly headed toward insolvency.
Perhaps the biggest driver of future deficits, however, is the incredibly sluggish economy the CBO expects current economic policies to produce. Read the rest of this entry »
Dave Boyer reports: When President Obama signs into law the new two-year budget deal Monday, his action will bring into sharper focus a part of his legacy that he doesn’t like to talk about: He is the $20 trillion man.
— Paul Winfree, director of economic policy studies at The Heritage Foundation
Mr. Obama’s spending agreement with Congress will suspend the nation’s debt limit and allow the Treasury to borrow another $1.5 trillion or so by the end of his presidency in 2017. Added to the current total national debt of more than $18.15 trillion, the red ink will likely be crowding the $20 trillion mark right around the time Mr. Obama leaves the White House.
When Mr. Obama took over in January 2009, the total national debt stood at $10.6 trillion. That means the debt will have very nearly doubled during his eight years in office, and there is much more debt ahead with the abandonment of “sequestration” spending caps enacted in 2011.
“Congress and the president have just agreed to undo one of the only successful fiscal restraint mechanisms in a generation,” said Pete Sepp, president of the National Taxpayers Union. “The progress on reducing spending and the deficit has just become much more problematic.”
— Sen. Rand Paul
Some budget analysts scoff at the claim made by the administration and by House Speaker John A. Boehner, Ohio Republican, that the budget agreement’s $112 billion in spending increases is fully funded by cuts elsewhere. Mr. Boehner left Congress last week.
“The Boehner-Obama spending agreement would allow for unlimited borrowing by the Treasury until March 2017,” said Paul Winfree, director of economic policy studies at The Heritage Foundation. “This deal piles on billions of dollars to the national debt by increasing spending over the next three years and then not paying for it for a decade — with half of the offsets not occurring until 2025.” Read the rest of this entry »
In Senate testimony on October 27th, Secretary of Defense Ash Carter indicated that the U.S. might be taking on a more direct combat role in Syria’s civil war. Later today, President Obama is expected to announce the deployment of U.S. troops to northern Syria.
— Christopher Preble, Cato’s Vice President for Defense and Foreign Policy Studies
According to Cato Institute experts, this is a terrible idea.
“Defense Secretary Ash Carter’s statement…that the U.S. military ‘won’t hold back’ from engaging in ‘direct action on the ground’ in Syria is a troubling development,“ says Benjamin Friedman, Research Fellow in Defense and Homeland Security Studies at the Cato Institute. “It does not so much indicate mission creep as continuity of flawed policy. Competing objectives burden U.S. policy: helping weak rebels overthrow Assad, which prolongs the war and aids ISIS, and defeating ISIS, which aids Assad. Until we resolve that contradiction, the value of tactical gains against either foe will be limited. We should cease helping rebels and attack ISIS alone.”
— Visiting Research Fellow Brad Stapleton
Even without U.S. ground troops, the Obama administration’s policy of continuing to fund and arm Syrian rebel groups is problematic enough, especially now that Russia is more deeply involved in backing the Assad regime militarily. According to Visiting Research Fellow Brad Stapleton, this risks getting into a messy proxy war that won’t end well for Washington. “Unfortunately, there is probably little constructive the United States can do at this point to resolve the conflict in Syria and establish a stable new government,” Stapleton writes. “The Obama administration, therefore, should take care not to make a bad situation worse.”
Many commentators have proposed imposing no-fly zones or safe zones in Syria to ease the humanitarian crisis. But, as Emma Ashford, Visiting Research Fellow, explains, this is likely to backfire. “U.S. involvement in Syria displays no strategy, no boundaries and no clear goals,” Ashford writes. “The only viable long-term solution to Syria’s problems is diplomacy. But that has been pushed to the side in favor of airstrikes and limited, ad hoc rebel training programs.” Read the rest of this entry »
WASHINGTON (AP) — The federal government ran a bigger deficit in January, pushing the imbalance so far this budget year up 6.2 percent from the same period a year ago.
The Treasury Department said Wednesday the deficit for January stood at $17.5 billion compared to $10.3 billion a year ago. For the first four months of the budget year that began in October, the deficit widened to $194.2 billion from $182.8 billion during the same period last year.
The budget deficit has gradually narrowed since 2012, which was the fourth straight year in which it topped the $1 trillion mark. The improvement reflects the country’s economic recovery from recession. The government is seeing higher tax revenues as people go back to work and smaller payments for safety-net programs such as unemployment assistance. It also represents efforts by Congress to control deficits through higher taxes and across-the-board spending cuts.
Last year’s deficit benefited from a $24 billion special payment Freddie Mac made for the support it received during the financial crisis. The Congressional Budget Office forecasts a deficit of $468 billion for the full 2015 budget year, 3.1 percent lower than in 2014.
For the current budget year, government revenues total $1.05 trillion, an increase of 8.7 percent from the same period a year ago. Government spending totals $1.24 trillion, up 8.3 percent over last year. Read the rest of this entry »
Marine One-to-be: An artist’s rendering shows what Sikorsky’s proposed ‘VXX‘ presidential helicopter might look like
For Mail Online, David Martosko reports: The Department of Defense awarded a contract on Wednesday to a Connecticut company that will build a fleet of helicopters to replace the Marine One fleet that ferries U.S. presidents short distances.
The contract, given to Sikorsky Aircraft Corporation, will cost an initial $1,244,677,064 ‘for the engineering and manufacturing development phase of the Presidential Helicopter Replacement program.’ For that price the U.S. Navy will get six test aircraft and all the necessary research & development.
The Pentagon made a similar attempt to replace the aging fleet of Sikorsky choppers, spending $3.2 billion on a landing pad to nowhere.
Adding in the likely $17 billion price tag for the new project – a numberestimated by the Congressional Budget Office – the $20 billion total makes the fleet the most expensive helicopters ever built.
Seeing double? If the current fleet of presidential choppers looks a lot like the new one, it’s because the same company will build them, and it was the only firm to bid on the project
The CBO reports that the projected cost also ‘does not include costs to keep the 19 existing presidential helicopters in operation until they are replaced by new helicopters.’ Read the rest of this entry »
(CNSNews.com) – Terence P. Jeffrey writes: In the budget proposal he presented to Congress last month, President Barack Obama called for what would be the highest level of sustained taxation ever imposed on the American people, according to the analysis published last week by the Congressional Budget Office.
Under Obama’s proposal, taxes would rise from 17.6 percent of Gross Domestic Product in 2014 to 19.2 percent in 2024. During the ten years from 2015 to 2024, federal taxation would average 18.7 percent GDP.
America has never been subjected to a ten-year stretch of taxation at that level.
In the five fiscal years encompassing U.S. involvement in World War II (1942 through 1946), federal taxation averaged 16.1 percent of GDP.
In the fiscal years since World War II (1947 through 2013), federal taxation has averaged 17.1 percent of GDP. Read the rest of this entry »
Charles Krauthammer: Under this administration, the American national debt has still managed to racked up $7 trillion over 5 years.
In order to address the issue of excessive spending, Congress and the president must work towards reforming entitlements, but he remained doubtful that it would take place with the current makeup of Washington…(read more)
Guy Benson reports: For the fifth time in six years, Barack Obama missed his budget deadline — and for the sixth time in six years, the spending blueprint he eventually produced never comes close to balancing. The Washington Post previewed Obama’s budget last month, noting that the White House would peddle it as an end to America’s “era of austerity.” That’s rich. Under this president, the federal government has spent more money annually than at any other time in US history.
Annual deficits have ranged between $500 billion and $1.4 trillion. Prior to Barack Obama’s presidency, the United States had never racked up a single trillion-dollar annual shortfall. On his watch, Washington has done so four times. The Congressional Budget Office projects that on our current trajectory, we’ll hit $1 trillion again within eight years. Various fact-checkers have confirmed that among his many predecessors, President Obama is the “undisputed debt king,” having added more than $6 trillion to the nation’s red ink since taking office in 2009. In his first campaign, Obama called President Bush “unpatriotic” for amassing more than $4 trillion in gross national debt over two full terms in office.
So that, ladies and gentlemen, is the “era of austerity” that Obama has magnanimously decided to end. His new grand vision, the Associated Press reports, will “appeal to Democrats,” and is a politically-charged “messaging” document, according to Time:
Obama’s $3.9 trillion budget represents a laundry-list of policy proposals designed to help Democrats hold the Senate and pick up seats in the House. Obama essentially conceded the point last month, when the White House announced he is dropping calls for an unpopular, but cost-saving measure to change the way inflation is calculated for the purposes of entitlement programs like Social Security…
Ed Driscoll writes: It’s no coincidence that the left seems rather Orwellian at times; after all, Ingsoc in1984 was Orwell’s 1949 warning regarding what English Socialism could metastasize into a generation down the line. Why not American socialism?
One of the left’s current (and frequently Orwellian) buzzwords is “sustainability.” Lately, based on recent headlines, the left seems to reaching peak Orwell. Is such a condition sustainable? There seem to be an enormous amount of euphemisms, doublethink and moral evasions in the headlines these days. Here’s a just a taste:
In order to play the losing hand the left have chosen to deal to themselves and the rest of the country via Obamacare, some Ministry of Truth-style euphemisms regarding work and employment have recently become necessary. As Michael Goodwin noted yesterday at the New York Post, “America now has a government that views work as a trap and celebrates those who escape it:”
That is the upshot of last week’s remarkable exchange over ObamaCare. It began when the head of the nonpartisan Congressional Budget Office reported that the interplay of taxes and subsidies in the law “creates a disincentive for people to work.” The report predicted the mix would lead to fewer hours worked, costing the equivalent of nearly 2.5 million jobs.
Kevin D. Williamson writes: Of the seven deadly sins, envy may not be the wickedest, but it is the most embarrassing. To be possessed by envy is to admit a humiliating personal inadequacy: We do not envy others those attainments that we think we too might achieve, but those we despair of ever possessing. Wrath, greed, pride, lust — all assume a certain self-possession. Sloth and gluttony are practically standard issue in times of plenty such as these. Wrath and pride are the sins of great (but not good) men. Envy is the affliction of the insignificant. It is the small man’s sin.
Which brings us to Robert Reich, who, having practically made a cult of envy, has taken to abusing the well-off for their acts of charity. Professor Reich, a ward of the taxpayers of California (at $246,199.84 per annum) and a federal ward before that, is persistently unhappy about how other people use their money, and he scoffs that America’s rich philanthropists are phony and self-serving, investing too much in opera and ballet and fancy colleges, and too little in feeding the hungry and housing the homeless. He particularly resents the fact that our tax code encourages such giving, with deductions that reduced federal revenue by some $39 billion last year — federal revenue that could have gone toward employing men such as Robert Reich.
This calls to mind Edmund Spenser’s description of Envy personified: “He hated all good works and virtuous deeds / And him no less, that any like did use / And who with gracious bread the hungry feeds / His alms for want of faith he doth accuse.”
Professor Reich being Professor Reich, you can guess how his argument unfolds. (If you have read one Robert Reich column, which is one too many, you have read them all.) He writes: “As the tax year draws to a close, the charitable tax deduction beckons. America’s wealthy are its largest beneficiaries. According to the Congressional Budget Office, $33 billion of last year’s $39 billion in total charitable deductions went to the richest 20 percent of Americans, of whom the richest 1 percent reaped the lion’s share.” It goes without saying that he makes no attempt to compare the apportionment of charitable tax deductions with charitable donations — that would only complicate things and invite an unpleasant encounter with reality.
Tony Lee reports: Though Republicans and Democrats in favor of comprehensive immigration reform are ready to make a final push next year, a new national Gallup poll released on Thursday found that only 3% of the country believes immigration reform is the most important issue that needs to be addressed.
The top concern of Americans who were surveyed was “dissatisfaction with the government” (21%). That was followed by the economy (19%), healthcare (17%), unemployment (12), the budget deficit (9%), moral/ethical decline (7%), poverty/hunger/homelessness (5%), and education (4%).
Immigration also does not register among the top-five most important issues to Republicans, Democrats, and Independents.
Michael Tanner writes: As this session of the 113th Congress draws to a merciful close, much of the punditry has picked up on the refrain that this is the “most unproductive Congress in history.” Indeed, this Congress has passed just 28 bills, easily eclipsing the previous record for inactivity set by Congress in 2012, when it passed just 68 new laws. But why, we might ask, is this such a bad thing?
Sure, there are things we might have wished Congress had accomplished. Something to address immigration or entitlement reform springs to mind. And it certainly would have produced less chaos if Congress had actually managed to pass annual appropriations bills instead of cramming all spending into the usual last-minute continuing resolution.
But there is a presumption behind such handwringing that we really need Congress to be even more involved in our lives than it is. Consider the laundry list of new programs that President Obama introduced in his State of the Union address back in January: early-childhood education, green energy, more economic stimulus, a higher minimum wage, and so on. Would we really have been better off if those things had passed?
Niraj Chokshi writes: The income gap in America has been widening for decades and the modest three-year recovery did little to change that, according to new Census data.
The new data suggest that despite modest recoveries in many states, the middle class has been shrinking while households have been added in the lowest and highest income brackets. In many states and nationally, the highest income brackets saw more growth than the lowest, but households in the middle brackets continued to decline. The state-by-state data compare incomes from a pair of three-year periods: 2007 through 2009, a span that included the Great Recession, and 2010 through 2012, a period that included the ongoing and modest recovery.
For years, the wealthiest 1 percent have amassed income more quickly than the rest. From 1979 through 2007, for example, the top 1 percent of households saw income grow by 275 percent, according to a nonpartisan Congressional Budget Office study. Compare that to the bottom fifth of households, which saw income gains of only 18 percent over that time. Recent Nobel Prize winner for economics Robert Shiller, who is known for creating a closely tracked home-price index, last month called income inequality “the most important problem that we are facing now today.” And just last week, President Obama’s nominee to lead the Federal Reserve, Janet Yellen, called income inequality “an extremely difficult and to my mind very worrisome problem.”
Charles Blahous writes: Today the Mercatus Center is releasing a study I completed earlier this year that comprehensively analyzes the policy decisions underlying federal deficits. Too often partisan advocates focus on a limited time period to purposely throw blame on a targeted political figure. Instead I dissected the entire budget, identifying deficit-driving policies regardless of when they were enacted. The study was a mammoth undertaking; it required the digestion of practically every Congressional Budget Office (CBO) and Office of Management and Budget (OMB) budget report published over the past forty years.
The striking finding is that more than three-quarters of our long-term fiscal problem derives from a set of policy decisions made over a period of just seven years, 1965 to 1972. 1965 saw the establishment of Medicare and Medicaid, advocated for and signed by President Lyndon B. Johnson. Both of these programs were later expanded in 1972 during the Nixon administration, as was Social Security. Nothing done by any recent President or Congress carries long-term fiscal consequences as daunting as those arising from these 1965-72 decisions. Read the rest of this entry »
John Nolte reports: NBC’s Chuck Todd scored a huge interview with President Obama Thursday and opened things by immediately drilling down on the president’s relentlessly repeated lie that under ObamaCare you can keep your current insurance plan if you like it. The full interview is even more impressive than the clips that have been going around. Even after he elicits a “sorry” from Obama, Todd keeps after the point for almost ten minutes.
Ultimately, though, Todd came away with the impression that Obama doesn’t believe he lied. And Todd is probably right, which is a little unnerving.
During his own interview on the Hugh Hewitt show Friday with guest host Carol Platt Liebau, Todd said, “You know, he does not believe he lied on this, and that’s the sense I get.” Here is Todd’s entire quote:
You know, he does not believe he lied on this, and that’s the sense I get. I mean, I think that that’s, he’s taken issue with that before with folks off the record, and I got it’s a sensitive issue, felt like he did not sit there and say he intentionally lied. He said that he wanted to, he thought he was going to be able to keep this promise. I thought what was revealing in that answer, when I asked him that direct question about this, was this a political lie that you started to believe it, was he talked about well, you know, it turns out we had trouble in crafting the law.
If Obama has convinced himself he didn’t lie, that borders on pathological. We now know that as far back as 2010 the president knew eight to nine million people would lose their health insurance. We have him on video admitting to that:
The 8 to 9 million people you refer to that might have to change their coverage — keep in mind out of the 300 million Americans that we are talking about — would be folks who the CBO, the Congressional Budget Office, estimates would find the deal in the exchange better. Would be a better deal. So, yes, they would change coverage because they got more choice and competition.
President Obama’s decision to tell people they could keep the healthcare they liked was not only unwise, it was untrue and the president knew it, Charles Krauthammer said Friday night.
Krauthammer went on the blast Obama for saying that only those who the CBO said it would get a better deal would get forced off their plans.
JOHN HINDERAKER: As Tyler Durden notes, this is the “most disturbing sentence uttered during the debt ceiling debate/government shut down.” America is now going on $17 trillion in debt, a level of insolvency that would already be regarded as catastrophic if the Fed were not keeping interest rates close to zero.
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