As Obama proposes $744 BILLION spending deficit, both Democrats and Republicans have found something in the White House budget that they can hate
If President Barack Obama wanted a
showdown over the federal government's 2014 budget, he got his wish -
only instead of Republicans vs. Democrats, it's the White House vs.
members of Congress on both sides of the aisle.
The hefty tome handed to Congress Wednesday afternoon included a $744 billion deficit that sent the GOP howling for fiscal sanity, and leverages the so-called "Chained Consumer Price Index" as a new way of calculating cost-of-living benefit increases - a sure-fire way to enrage liberals in his political base.
That projected deficit is down from an estimated $973 billion in fiscal 2013.
Though the president claimed his $3.8 trillion proposal for 2014 was a good-faith 'compromise,' Republicans on Capitol Hill laughed it off as the latest in a series of pie-in-the-sky plans to spend the government's way to prosperity.
'It's quite similar, frankly, to his budget last year, and it's two months late,' said Senate Minority Leader Mitch McConnell. 'We're not sure this is a serious exercise.'
The president's budget arrived two months after the statutory deadline, which passed in February. The White House on Wednesday blamed the rancorous budget-sequester talks in Congress, and the time taken by separate majorities in the House and Senate to develop their own budget proposals, for the delay.
'If you put in place Carter-era policies, you're going to get Carter-era results,' quipped South Dakota Republican Sen. John Thune. 'Doubling down on higher taxes to fuel more spending at the expense of job creation and economic growth is a really bad policy and is going to get you the same result that we've been looking at.'
'It's time for this president to quit growing the government [and] start working with us to grow the economy.'
Meanwhile, the new CPI measurement promises to raise $230 billion to cover parts of what would otherwise be an even more crushing deficit.
Liberal pressure groups have
generated more than 2 million protest letters and emails objecting to
it, claiming that low-income seniors and veterans will suffer as
increases in benefit levels are trimmed back in the coming decade.
Democracy for America chairman Jim Dean said in a CBS News broadcast that Obama was turning his back on liberal voters.
'Real Democrats do not cut Social Security or Medicare or Medicaid, ever,' he said during a protest outside the White House. 'We do not have his back on this proposal.'
Obama insisted during remarks in the White House Rose Garden that he wouldn't leave low-income Americans behind in order to balance the federal budget.
'If anyone thinks I'll finish the job of deficit reduction on the backs of middle-class families or through spending cuts alone that actually hurt our economy short-term, they should think again,' he said.
'When it comes to deficit reduction, I've already met Republicans more than halfway.'
GOP legislators countered that they had already given the president more than $1.6 trillion in new tax revenues since the beginning of the fiscal cliff debate last year, and complained that he wants an ever-larger bite at Americans' earnings for more spending programs.
Obama should get 'some credit
for some of the incremental entitlement reforms that he has outlined in
his budget,' conceded House Speaker John Boehner, the president's chief
adversary. 'But I would hope that he would not hold hostage these modest
reforms for his demand for bigger tax hikes.'
'The president got his tax hikes in January. We don't need to be raising taxes on the American people.'
Those tax increases, according to the White House's budget blueprint, would total $583 billion through the years 2023. They would come, in part, from new limits on income tax deductions imposed on high-earning taxpayers, and from Obama's so-called 'Buffett Rule,' which sets a minimum 30 percent federal income tax rate for Americans who report earning $1 million or more.
Other new taxes include an increase of more than $71 billion in receipts from federal estate and gift taxes, and $44 billion in tax increases on producers of coal, oil and natural gas.
Obama's proposal overall exceeds the spending requests of both parties in Washington. In March House Republicans approved a $3.2 trillion budget, an amount made small by comparison when Senate Democrats voted to spend $3.71 trillion instead.
The White House proposal was larger still.
While partisans on both Obama's left and right took shots at the parts of the budget that they said undermined their voting constituencies' values, journalists and analysts dug into the weeds for hours after the document's release to determine what exactly made up the meat in Obama's fiscal sandwich.
His demands included a new minimum-wage hike, vague school 'reforms,' $50 billion in stimulus-style spending on unspecified road-building and other infrastructure projects, additional new spending to develop alternative energy sources, a program of government-run universal day care and new taxes on 'the wealthy and well-connected' who he said 'game the system.'
The day care proposal, the
president added, would be funded by nearly doubling federal taxes on
tobacco, a move that would collect $78 billion in new revenue over a
decade.
Cost-savings for which Obama is claiming credit - and taking a victory lap - include $1.38 billion from ending the wars in Iraq and Afghanistan, funds credited to the government's balance sheet by virtue of no longer needing to spend them.
The president, Politico reported, is also slashing $452 million from a program that funds heating assistance for low-income households, and trims back farm subsidies and funding to detain illegal immigrants.
New spending proposals include additional funds for overseas embassy security - something recommended by the White House's Benghazi Review Board - and hundreds of millions to support controversial gun control proposals.
It also includes a $943 million bailout for the troubled Federal Housing Administration, whose fiscal sturdiness has been challenged by a raft of mortgage defaults related to an administration strategy that sought to extend credit to home buyers, including many minorities, who would not qualify for home financing on the merit of their own FICO credit scores.
When those homeowners abandon their mortgages or declare bankruptcies, the FHA covers banks' losses under an insurance plan that the Obama administration has operated at new levels of spending since 2009.
House Financial Services Committee Chairman Jeb Hensarling, a Texas Republican, told the Los Angeles Times that 'if the FHA were a private financial institution, likely somebody would be fired, somebody would be fined, or the institution would find itself in receivership.'
'Instead, the FHA is merrily on its way to becoming the recipient of the next great taxpayer bailout. It’s outrageous.'
Overall, 2012 GOP vice presidential nominee Paul Ryan drew the starkest contrast between the president's proposal and his own, appearing on the MSNBC Morning Joe program.
'The real question I want to know is when does he balance the budget?' Ryan said. 'Does he propose to ever balance the budget?'
Boehner echoed his criticism hours later. 'Unfortunately, the president's budget never comes to balance,' the speaker said.
Ryan's signature budget plan proposed a ten-year process ending in a balanced federal budget. He aimed to achieve this by lowering tax rates and spurring business investment while at the same time limiting healthcare spending and social programs expenditures.
Obama's plan, paradoxically,
claims to reduce federal spending on health care by $401 billion over
the next ten years, despite recent admissions from his administration
that some Americans' health care costs will increase under the Obamacare
law, and that the complexity of implementing the law and its tens of
thousands of pages of regulations exceeded the White House's
expectations.
The law calls for the federal government to earn $450 million by charging insurance companies for the right to sell their products to businesses and individuals in so-called health care 'exchanges' run by the Department of Health and Human Services.
But HHS Secretary Kathleen Sebelius said Wednesday that the president's budget included $1.5 billion in spending just to operate those exchanges in 30 states that have opted not to run them locally.
The Fox Business
channel reported that Obama's budget includes sweeping change in the
program that the Department of States uses to distribute food aid to
foreign countries.
Instead of buying food from American farmers and shipping it overseas, the new guidelines would call for cash disbursements of $1.1 billion to a relief fund accessible to foreign governments, which would then buy food locally to save the shipping expenses, which can be substantial since U.S.-flagged ships must be used to move the cargo under current law.
As the White House moves to convince Republicans in the coming days that its budget is a final offer - not a mere jumping-off point for negotiation - budget wonks in the West Wing will first have to convince New York Times columnist Paul Krugman, the noted liberal Nobel laureate economist.
Obama’s budget, Krugman wrote Wednesday, is 'all about the positioning,' and less about the merits of targeted proposals. The White House, he claimed, wants most of all to persuade the public that Obama is more willing to compromise than his Republican opposition.
'Unfortunately, it will almost surely fail,' Krugman concluded.
'Why? Because there are no grownups [in Washington] - only people who try to sound like grownups, but are actually every bit as childish as anyone else.'
The hefty tome handed to Congress Wednesday afternoon included a $744 billion deficit that sent the GOP howling for fiscal sanity, and leverages the so-called "Chained Consumer Price Index" as a new way of calculating cost-of-living benefit increases - a sure-fire way to enrage liberals in his political base.
That projected deficit is down from an estimated $973 billion in fiscal 2013.
Though the president claimed his $3.8 trillion proposal for 2014 was a good-faith 'compromise,' Republicans on Capitol Hill laughed it off as the latest in a series of pie-in-the-sky plans to spend the government's way to prosperity.
'It's quite similar, frankly, to his budget last year, and it's two months late,' said Senate Minority Leader Mitch McConnell. 'We're not sure this is a serious exercise.'
The president's budget arrived two months after the statutory deadline, which passed in February. The White House on Wednesday blamed the rancorous budget-sequester talks in Congress, and the time taken by separate majorities in the House and Senate to develop their own budget proposals, for the delay.
'If you put in place Carter-era policies, you're going to get Carter-era results,' quipped South Dakota Republican Sen. John Thune. 'Doubling down on higher taxes to fuel more spending at the expense of job creation and economic growth is a really bad policy and is going to get you the same result that we've been looking at.'
'It's time for this president to quit growing the government [and] start working with us to grow the economy.'
Meanwhile, the new CPI measurement promises to raise $230 billion to cover parts of what would otherwise be an even more crushing deficit.
President Barack Obama and acting budget
director Jeff Zients (L) presented his budget proposal Wednesday to
media assembled in the White House Rose Garden. Republicans began
responding before the president was done talking
Democracy for America chairman Jim Dean said in a CBS News broadcast that Obama was turning his back on liberal voters.
'Real Democrats do not cut Social Security or Medicare or Medicaid, ever,' he said during a protest outside the White House. 'We do not have his back on this proposal.'
Obama insisted during remarks in the White House Rose Garden that he wouldn't leave low-income Americans behind in order to balance the federal budget.
'If anyone thinks I'll finish the job of deficit reduction on the backs of middle-class families or through spending cuts alone that actually hurt our economy short-term, they should think again,' he said.
'When it comes to deficit reduction, I've already met Republicans more than halfway.'
GOP legislators countered that they had already given the president more than $1.6 trillion in new tax revenues since the beginning of the fiscal cliff debate last year, and complained that he wants an ever-larger bite at Americans' earnings for more spending programs.
Not giving an inch: House Speaker John Boehner
said Wednesday that 'the president got his tax hikes in January. We
don't need to be raising taxes on the American people'
'The president got his tax hikes in January. We don't need to be raising taxes on the American people.'
Those tax increases, according to the White House's budget blueprint, would total $583 billion through the years 2023. They would come, in part, from new limits on income tax deductions imposed on high-earning taxpayers, and from Obama's so-called 'Buffett Rule,' which sets a minimum 30 percent federal income tax rate for Americans who report earning $1 million or more.
Other new taxes include an increase of more than $71 billion in receipts from federal estate and gift taxes, and $44 billion in tax increases on producers of coal, oil and natural gas.
Obama's proposal overall exceeds the spending requests of both parties in Washington. In March House Republicans approved a $3.2 trillion budget, an amount made small by comparison when Senate Democrats voted to spend $3.71 trillion instead.
The White House proposal was larger still.
While partisans on both Obama's left and right took shots at the parts of the budget that they said undermined their voting constituencies' values, journalists and analysts dug into the weeds for hours after the document's release to determine what exactly made up the meat in Obama's fiscal sandwich.
His demands included a new minimum-wage hike, vague school 'reforms,' $50 billion in stimulus-style spending on unspecified road-building and other infrastructure projects, additional new spending to develop alternative energy sources, a program of government-run universal day care and new taxes on 'the wealthy and well-connected' who he said 'game the system.'
Amanda Bynes is fond of lighting up - and in New
York City! - but she'll have to pay an extra $1 per pack in new federal
taxes if the president gets his way. The funds would create a new
government-run guaranteed day care program
Cost-savings for which Obama is claiming credit - and taking a victory lap - include $1.38 billion from ending the wars in Iraq and Afghanistan, funds credited to the government's balance sheet by virtue of no longer needing to spend them.
The president, Politico reported, is also slashing $452 million from a program that funds heating assistance for low-income households, and trims back farm subsidies and funding to detain illegal immigrants.
New spending proposals include additional funds for overseas embassy security - something recommended by the White House's Benghazi Review Board - and hundreds of millions to support controversial gun control proposals.
It also includes a $943 million bailout for the troubled Federal Housing Administration, whose fiscal sturdiness has been challenged by a raft of mortgage defaults related to an administration strategy that sought to extend credit to home buyers, including many minorities, who would not qualify for home financing on the merit of their own FICO credit scores.
When those homeowners abandon their mortgages or declare bankruptcies, the FHA covers banks' losses under an insurance plan that the Obama administration has operated at new levels of spending since 2009.
House Financial Services Committee Chairman Jeb Hensarling, a Texas Republican, told the Los Angeles Times that 'if the FHA were a private financial institution, likely somebody would be fired, somebody would be fined, or the institution would find itself in receivership.'
'Instead, the FHA is merrily on its way to becoming the recipient of the next great taxpayer bailout. It’s outrageous.'
Overall, 2012 GOP vice presidential nominee Paul Ryan drew the starkest contrast between the president's proposal and his own, appearing on the MSNBC Morning Joe program.
'The real question I want to know is when does he balance the budget?' Ryan said. 'Does he propose to ever balance the budget?'
Boehner echoed his criticism hours later. 'Unfortunately, the president's budget never comes to balance,' the speaker said.
Ryan's signature budget plan proposed a ten-year process ending in a balanced federal budget. He aimed to achieve this by lowering tax rates and spurring business investment while at the same time limiting healthcare spending and social programs expenditures.
'I've already met Republicans more than halfway'
on deficit reduction, Obama claimed. But GOP leaders said they have
been doing all the compromising, with more than $1.6 trillion in new tax
revenues during recent negotiations
The law calls for the federal government to earn $450 million by charging insurance companies for the right to sell their products to businesses and individuals in so-called health care 'exchanges' run by the Department of Health and Human Services.
But HHS Secretary Kathleen Sebelius said Wednesday that the president's budget included $1.5 billion in spending just to operate those exchanges in 30 states that have opted not to run them locally.
HHS Secretary Kathleen Sebelius conceded this
week that Obamacare would be far tougher to implement than the Obama
administration anticipated. The president's budget calls for far more
spending on the new health law than it estimates the government will
collect from health insurers
Instead of buying food from American farmers and shipping it overseas, the new guidelines would call for cash disbursements of $1.1 billion to a relief fund accessible to foreign governments, which would then buy food locally to save the shipping expenses, which can be substantial since U.S.-flagged ships must be used to move the cargo under current law.
As the White House moves to convince Republicans in the coming days that its budget is a final offer - not a mere jumping-off point for negotiation - budget wonks in the West Wing will first have to convince New York Times columnist Paul Krugman, the noted liberal Nobel laureate economist.
Obama’s budget, Krugman wrote Wednesday, is 'all about the positioning,' and less about the merits of targeted proposals. The White House, he claimed, wants most of all to persuade the public that Obama is more willing to compromise than his Republican opposition.
'Unfortunately, it will almost surely fail,' Krugman concluded.
'Why? Because there are no grownups [in Washington] - only people who try to sound like grownups, but are actually every bit as childish as anyone else.'