The president’s budget is disappointing, unsurprising, and dangerous

Douglas Holtz-Eakin Former Director, CBO
Font Size:

President Obama’s 2013 budget is fundamentally disappointing. The lesson of history for countries with the “U.S. disease” — poor growth and bloated current and projected debt — is fairly simple: keep taxes low, reform the tax code to make it more pro-growth, and cut spending by focusing on transfer programs while preserving and making more efficient the core functions of government, like national defense, infrastructure, basic research, and education.

What does Barack Obama propose for the United States? Cuts to defense spending, higher taxes, no tax reform, no entitlement reform, and no substantial reforms to the way government delivers its core services. Yes, he does promise to spend more on infrastructure and education (no reforms), but not even this president can shoot an air ball every time.

So much for the president elected on a change platform three years ago.

But this is hardly surprising. After all, the president put out essentially the same budget for 2012 (although this one is more festooned with campaign-related giveaways), which was shockingly similar to the 2011 budget, which pretty closely aped the 2010 fiasco. This marks his fourth consecutive abdication of the core obligations of his office, so it is getting predictable.

But disappointing plans full of anticipated red ink are not the full measure of this budget. Instead, it has crossed the line to dangerous. This budget is Barack Obama’s campaign platform. Put differently, this is what he wants a mandate to implement if he is re-elected.

This budget is dangerous to future seniors and needy Americans. The federal social safety net is tattered. For the president to have no plan to preserve the social safety net for future generations is dangerous. This budget is dangerous to small businesses and workers. At its core is a plan to burden small businesses with higher taxes, without a tax-reform plan that would permit workers in America’s international firms to compete on a level playing field around the globe and benefit from more rapid economic growth at home. This budget is dangerous because it shatters the American commitment to deliver to each successive generation a nation that is secure, solvent, and prosperous. This budget is a plan to saddle the next generation of Americans with uncountable debt, which they will have to pay off while they struggle to get by in a broken economy. Ultimately, this budget is dangerous because it fails to address America’s most pressing challenges at a critical moment in the nation’s history.

Last year, the president discarded the recommendations of his own fiscal-reform commission — the so-called Bowles-Simpson Commission. The backlash was severe enough that Obama played a budget mulligan, giving a speech that served as a mea culpa and an acknowledgment that he was on the wrong track. As the president continues his perpetual campaign, we can only hope that the citizenry will demand another budgetary do-over, an approach infused with real leadership that can deliver growth, preserve the social safety net, and deliver a stronger America to future generations.

Let us hope so.

Douglas Holtz-Eakin is president of the American Action Forum. He was the director of economic policy for John McCain’s 2008 presidential campaign.