Compare, contrast

Matthew Hoy
By Matthew Hoy on March 2, 2009

It's been noted by many that President Obama's budget is different from that of his predecessor only in emphasis, not technique.

In his radio talk, Obama did not address the charge that his plans are simply too expensive. But he reasserted his commitment to fiscal discipline, saying his budget team has "identified $2 trillion worth of deficit reductions over the next decade" by scouring the budget "line by line" for wasteful and inefficient programs.

Obama first made that claim in his address to Congress on Tuesday. But administration officials have since acknowledged that his budget plan does not contain $2 trillion in spending cuts. It includes $1.5 trillion in "savings" generated by comparing Obama's plan to wind down the war in Iraq against a scenario many consider unrealistic -- one in which war spending consumes more than $200 billion a year for much of the next decade. Because Obama wouldn't be borrowing to pay for a war that costly, he also says he would save more than $300 billion in interest on the national debt.

The claim of $2 trillion in savings is "easily blown apart," said Robert Bixby, executive director of the nonpartisan Concord Coalition, a deficit watchdog group, and one of several deficit hawks briefed on the plan by White House budget director Peter R. Orszag.

Obama's generated "savings" by ending (not necessarily winning) the Iraq war has been likened to a family planning a $10,000 vacation and "saving" $10,000 by not taking the vacation.

Which brings us to this howler from the New York Times Paul Krugman last week.

And these new priorities are laid out in a document whose clarity and plausibility seem almost incredible to those of us who grew accustomed to reading Bush-era budgets, which insulted our intelligence on every page. This is budgeting we can believe in.

Now, you get Paul Krugman to insult your intelligence instead of President George W. Bush. CHANGE!

Krugman also concedes that more change is coming -- the hold on to your wallet kind.

And even if fundamental health care reform brings costs under control, I at least find it hard to see how the federal government can meet its long-term obligations without some tax increases on the middle class. Whatever politicians may say now, there’s probably a value-added tax in our future.

Even Krugman admits that Obama's 95 percent of Americans will get a net tax cut promise has an expiration date -- it's just that it's likely several months off.


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March 2009



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