The Obama Budget? A Plan or a Train Wreck?


The President’s budget was released with the usual threats to refuse to negotiate with Republicans in the co-equal branch of government called Congress.  It is, quite literally, a monumental proposal, with total spending in the budget totaling $3.778 trillion dollars.  Or, as the average accountant would write it:

$3,778,000,000,000

Looking at it another way, we currently have a national debt in the $16 trillion range that has accumulated since George Washington was first sworn in as President, through the War of 1812, the Civil War, the Spanish American War, World War I, World War II, the Korean Conflict, Vietnam, the assorted wars that never even earned a real name, the construction of the Transcontinental Railroad, landing men on the moon, and a few other odds and ends.  All that went on over more than 200 years, yet for only the next year, just one single year, Obama intends to spend an amount that is nearly 25% of that number.  He wants to spend one-quarter of the debt the entire nation has accumulated over 200 years in just twelve months.

So perhaps “monumental” is the best description.  Just what such a monument will memorialize is something that will be determined at later date.

Obama’s budget, which was submitted two months late, is supposed to cover the government’s expenses for the twelve months beginning October 1, 2013, a date that is slightly less than six months away.

Of course six months is not an insignificant length of time, but please remember that we are talking about the President and our Congress negotiating to an agreement that although they might not like it, they can all live with it.  But since we’re dealing with this particular President and this particular Congress, it seems unlikely that they could come to an agreement on what to have for lunch in less than six months.

The President’s proposed budget relies heavily on his demand for a “balanced” approach, meaning increased taxes on the less favored of our citizens, rather than fiscal restraint alone.

Less favored?  Why else would taxes be levied against only certain taxpayers unless they deserved to be punished in some way?  For example, in Obama’s budget, $78 billion in new taxes is tagged to pay for early childhood education, with is bureaucratese for “Head Start”.  Now we all agree that education for our children, or in my case, my grandchildren, is important.  We all want what’s best for our kids, right?  So why aren’t we all contributing to such a worthy program?

We all aren’t?  No, in fact under Obama’s budget proposal, not everyone will be coughing up the money to send our four-year olds to pre-school.  The President is demanding (remember that whole “balanced” approach thing?) that Congress enact a tax that will add ninety-four cents a pack to all cigarettes to cover the entire $78 billion.  Does this mean that the President thinks that only smokers care about our tots?  If educating four-year olds is so critical to their development and the ultimate future of America, shouldn’t all of us be contributing and not just smokers?  Well, maybe someone once blew smoke in Obama’s face when he was a child and this is simply payback.

One of the Presidents favorite “less favored” groups are those who are rich and successful, unless those who are rich and successful reside in Hollywood.  This less favored group will also get themselves singled out for the assault of the tax man.  The President’s budget shows that the man who once said “at a certain point you’ve earned enough” is now able to say that “at a certain point you’ve saved enough for your retirement.”   Obama would like the Congress to raise taxes by limiting the deduction for IRA contributions when the IRA account reaches $3 million.  He has stated that three million dollars should be enough for anyone’s retirement.  He avoids any mention of what he might do to totals above that three million dollar level.

Now many on the left, and to be honest not a few on the right, would think that this was a reasonable demand.  And if the tax revenue realized from such limitations would help reduce the deficit and our national debt, even I might not fight it too hard.  But, and here’s where the devil really is in the details, Obama not only tells Congress just what taxes he wants to raise, but an estimate of how much revenue will increase if they accede to his quite reasonable views.  He will raise a whopping $9 billion…over ten years.  You can instantly see how that nine billion will make a huge dent in a national debt that is headed for the twenty-five thousand billion level, can’t you?  Since Mr. Obama has almost made “millionaires and billionaires” a full blown fetish, any action that singles out the wealthy and successful is always described as reasonable, and he might even see it that way.

But as any examination of taxation will tell you, these things never seem to maintain their rifle-like focus.  They seem to spread.  More like a shotgun blast (and we all know that Obama shoots skeet, so the analogy is probably close.)  For instance the original income tax was supposed to be limited, too.

The income tax, the 16th Amendment, was originally sold as a measure to soak the rich. Only the rich were to pay it, and the rates were nominal — 1% for married couples earning up to $20,000, 7% for those earning up to $500,000. Adjusted for inflation, in 2012 dollars that would be 1% on incomes up to $463,826 and 7% up to incomes greater than $11.59 million — clearly for the infamous 1%-ers.  So the President’s demand to limit IRA deductions for his personal nightmare, those millionaires and billionaires, might creep to lower and lower levels within the social fabric of America.  It’s happened before.

In essence, then, Obama’s new budget is almost identical to every other “initiative” that has come out of the White House since 2009, which is reward supporters and punish his enemies.

Further evidence of this is the President’s push for the creation of a sort of Infrastructure Bank, to invite private parties to participate in improving, expanding or repairing American’s deteriorating roads, rails and public buildings.   Why would any private enterprise want to be involved with building or repairing roads?  Perhaps because they saw how will it worked out for Solyndra.  Perhaps there are any number of other reasons.

But to be truthful, if this concept was actually implemented, I for one would never drive over a bridge that they were involved in building.

This is the unedited version of the article which appeared in American Thinker.

Advertisements

About Jim Yardley

Retired after 30 years as a financial controller for a variety of manufacturing firms, a two-tour Vietnam veteran, and independent voter.
Gallery | This entry was posted in Barack Obama, Deficit, Economy, Government Spending, Limited Government, Political Doubletalk, Taxes, U.S. Government and tagged , , , , , , , , , , . Bookmark the permalink.

2 Responses to The Obama Budget? A Plan or a Train Wreck?

  1. Jim M says:

    It is incorrect to draw upon the entirety of the U.S. history and to say that is where the accumulation of debt came. The budget was balanced under Clinton. The debt, in your buzz word, “monumentally” grew under former President G.W. Bush, and further exacerbated by recession.

    • Jim Yardley says:

      Actually, Jim M, it is you who have been misled by the language of the problem. Yes, under Clinton and the Republicans in Congress at that time, the budget for a short time was balanced. Unfortunately, that only means that they didn’t ADD to the national debt. It does not mean that the pre-existing debt was wiped out or that it never existed. Politicians and a compliant media frequently use the terms “debt” and “deficit” as equivalent terms, but they mean very different things. Any deficit adds to our total national debt. Just running to budget means that there is no deficit, and no further increase in debt FOR THAT ONE YEAR ONLY.

      I agree that George W. Bush added to the debt, because he ran the government and spent more than the budget generated in revenue. So has Barack Obama. So did many other presidents before those two. In fact, you seem to gloss over the fact that Clinton did NOT run balanced budgets for each of his eight years in office. No one’s hands are clean, but that doesn’t mean that we should just shrug and tell ourselves that they all do it, so just live with it.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s