Obama’s budget would add almost $1 trillion in debt every two years
White House spokesman Jay Carney on Monday excused the president’s unprecedentedly late budget submission as a bargaining tactic, and he called for large annual deficits until at least 2023.
“The broader effort underway here is to try to achieve through the budget process, a compromise” that would stabilize the federal government’s deficit at roughly 3 percent of the nation’s economy, he told reporters during the midday press conference.
The nation’s GDP is roughly $15.1 trillion, so a 3 percent deficit goal would accept roughly $450 billion in new debt each year. Under Obama’s tenure, the federal debt has risen $6 trillion since 2009, up to almost $17 trillion.
GOP leaders, however, are trying to pass a balanced budget plan through the House.
“Instead of spending $46 trillion over the next 10 years, we’ll spend $41 trillion,” predicted the House GOP’s budget chief, Rep. Paul Ryan. “That’s means we’ll grow spending on average 3.4 percent a year instead of growing it an average 4.9 percent a year, which is the path we’re on, which … produces a debt crisis,” he said March 10 when interviewed on Fox News’ Sunday show.
In theory, the House budget would end new federal borrowing in 2023, but unexpected expenses — such as new war or natural disaster — could postpone the date.
Most GOP legislators believe the economy is spurred by the private sector, providing the government does not impose too many regulations or taxes. In contrast, Carney reiterated the president’s view that the economy is better boosted by government “investments.”
Carney’s call for large deficits prompted derision from GOP officials.
Carney is “making very clear Americans should not expect a budget that ever balances from this president,” said a midday tweet from Brendan Buck, a spokesman for House Majority Leader John Boehner.
By law, the White House’s detailed annual request for routine and novel agency funding for the next year must be submitted to Congress by the first Monday of February.
But Obama has instead delayed his budget request until after the GOP-led House and the Democratic-led Senate have introduced and debated detailed, multi-year budget plans.
The delay gives him and his allies an opportunity to criticize GOP budget plans, while shielding himself from similar criticism.
Obama’s budget request may also exclude budget-balancing proposals that the president has repeatedly says he would support. The proposals include a revised formula for calculating inflation’s impact on the Consumer Price Index. Over 10 years, the measure could trim the federal government’s budget by a few hundred billion dollars.
That “chained CPI” proposal “is on the table,” Carney said. But when asked if it would be included in the budget request, he punted. “I would wait for the budget to come out,” he said.
The president’s delay in submitting a budget may lead to yet another fiscal crisis late in 2013 if Obama’s push for tax increases derails the Congress’ complex budget deal-making.
During the last four years, the government’s annual budgets have been finalized in top-level crisis talks between the White House and the Hill, partly because Democrats in the Senate have declined to propose or debate a budget.
By avoiding floor debates, the Democratic leadership has allowed their members to avoid votes that would spur opposition in their home states.
“I don’t have a date for you on the president’s budget,” Carney told reporters during the midday press conference March 11. “It is being worked on,” he added.
“This is a process of negotiation,” he said.
The White House’s request will be merged with the House and Senate proposals, Carney said.
“The result [will be] a product that both reduces the deficit, invests in our economy, helps it grow … and doesn’t ask any segment of society to bear the burden of deficit reduction alone,” he said.