by Frank James
President Barack Obama's ambitious agenda to make major investments in healthcare, education and energy was imperiled by a new estimate by Congress's budget experts who suggested that the president's $3.6 trillion budget and its new initiatives would create significantly larger deficits than the White House has forecast.
The non-partisan Congressional Budget Office estimated that if Obama's budget were enacted, the deficit would total $2.3 trillion more for the ten-year period ending in 2019 than the president's budget proposal predicted.
Furthermore, the CBO forecast that under the president's budget proposals, deficits would consistently stay above four percent of the nation's gross domestic product for the entire period, a level that concerns economists as too high for the economy to successfully manage.
Despite the bad news from the CBO, Peter Orszag, director of the White House's Office of Management and Budget, said the administration remained confident it could accomplish its goals.
The differences between the White House and CBO were due to differing assumptions about economic growth though both the administration's and the CBO's fell within the range economists are projecting, he said.
"We remain confident that the four key principles that the president put forward for the budget - in particular, that it must invest in health care, that it must invest in education, that it must invest in clean energy and that it must cut the deficit in half by the end of his first term -- will all be accomplished," Orszag said.
The new forecast buttressed Republican criticisms that the president's budget proposals are far too costly.
"This report should serve as the wake-up call this administration needs," said House Minority Leader Rep. John Boehner (R-Ohio.) "We simply cannot continue to mortgage our children and grandchildren's future to pay for bigger and more costly government."
One potential problem for the White House was that the new CBO numbers could heighten growing concerns within Democratic ranks that Obama's budget proposals are much more expensive than the nation can afford.
Sixteen moderate Democratic senators, including senators Evan Bayh, of Indiana, Michael Bennet of Colorado and Kay Hagan of North Carolina have formed a new group to push for, among other issues, greater fiscal responsibility.
The new CBO forecast could give those Democrats ample new ammunition to resist the administration's pleas for support on a number of its proposals.
Comments
Starting from scratch after eight years of Bush Republican spending on useless crap like tax cuts for the rich 1-2%, big corporations, big oil and an unnecessary preemptive war in Iraq is tough.
Even though Pres Obama is spending to create jobs and stimulate the economy, that BushCo killed, it is going be a drag on the deficit BUT the big difference is that the BushCo Republicans deficit spending was wastefull and only benifitted the most wealthy and connected among us. What Pres Obama is doing now is circular, the more jobs that are created and saved, the more we'll be able to pay down the debt.
Posted by: Inconvenient Facts | March 20, 2009 5:59 PM
Hmmmm, I wonder where all of that deficit spending debt came from?...oh yeah!
http://media.photobucket.com/image/surplus/smokydoggg/surplus.jpg
Posted by: Deano | March 20, 2009 6:42 PM
Well don't look now but Big Oil and other energy companies are planning to move to Switzerland to avoid Obama and the Dems tax policies. There's nothing circular about that pal. Just when we need to get more competetive this admenstruation is going to grow the government (which produces nothing) and wants to make people as mediocre and dependant as they are by expanding their socialistic agenda.
It will all become very clear, very quickly how unmanageable and ill-conceived Obama's agenda actually is.
If you're thinking it can't get any worse, just watch, it is going to get even worse.
Posted by: Rob | March 21, 2009 12:29 AM
Last year the Democrats and the media worried mightly about the deficit and blamed George Bush.
Now Barack Obama is in charge and the deficit no longer matters.
Hypocrisy at work?
Posted by: Joe Jankovic | March 21, 2009 6:48 AM
President Obama has found the mother of all psychodynamic crevices from which to operate. As it stands now, if he showed up at someone's work place at lunchtime and took a wicked dump on the break room table, 60% would:
1) Argue vociferously that it was the right and absolutely necessary thing to do, otherwise he wouldn't have done it;
2) Oppose all attempts to clean it up; and,
3) Criticize Bush for never having done such during the entire preceding eight years.
The crevice Obama found is that he can't be wrong unless those who support him admit to being wrong. But when Obama looked the other way while PelosiCo jam packed the 787 with goodies, the crack widened a bit. Then when Obama decried earmarks but signed the 410, the crack widened a little bit more. When Obama, Dodd, and Geithner failed to pre-empt the AIG bonuses, bink, more crack widening. Now the CBO jammed a 10 foot long crowbar into that opened-up crevice. And as Frank James pointed out, 16 moderate democrats can now jump on the end of that crowbar.
The bad part about never being wrong, as Obama was during the campaign and is now in the Whitehouse is that when it's finally obvious that you're wrong, it all comes crashing down on you at once. This is like watching Jimmy Carter all over again.
Posted by: dom youngross | March 21, 2009 8:38 AM
BO's deficits are four times LARGER than President Bush's
.
http://news.yahoo.com/s/ap/20090320/ap_on_go_pr_wh/obama_budget
Posted by: Terry | March 21, 2009 11:46 AM
Dear Joe Jankovic,
I know that "deficits don't matter" because Vice President Dick Cheney said so! You're not calling him a LIAR, are you?
Posted by: BC | March 21, 2009 1:46 PM
Deano,
One thing you forget about that "surplus" with Clinton, there was a Republican controlled Congress from 1995 to 2000. I recall those years to be some GREAT economic times. But let's not let the facts get in the way.
Posted by: sman | March 23, 2009 10:45 AM