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Obama’s Three Years of Budget Failure

Posted By Arnold Ahlert On January 15, 2013 @ 12:45 am In Daily Mailer,FrontPage | 13 Comments

The mixture of arrogance and indifference to the law that has become the trademark of the Obama administration hit another mile marker yesterday. At a press conference, the president demanded that Congress raise the debt ceiling, because America is not “a deadbeat nation,” further characterizing the failure to do so as “irresponsible” and “absurd.” The White House should be quite familiar with both concepts: last Friday, the administration’s acting Budget Director, Jeff Zients, told House Budget Committee Chairman Paul Ryan (R-WI) that it will miss the legal deadline for submitting a budget to Congress.

The White House’s disregard for its legal obligations is hardly an anomaly. ”This will mark the third time in four years the president has missed his statutory requirement to present a budget on time, while trillion-dollar budget deficits continue to mount,” said Ryan. Nor is such irresponsible behavior limited to the White House. The Democratically controlled Senate has failed to pass a budget in more than three and a half years, taking several proposals enacted by the House and tabling them. The last time they adhered to their legal obligation was in 2009.

Missing the budget deadline is no accident. Last month, the White House told Politico that it had “deliberately slowed preparations for President Barack Obama’s fiscal 2014 budget” until it “had a better fix” on negotiations with Republicans regarding the fiscal cliff deal. Despite that reality, Obama had no qualms about taking Congress to task for its inability to reach a deal in a timely manner. “America wonders why it is in this town why you can’t get stuff done in an organized timetable,” said the president. “Why everything has to always wait until the last minute. We’re now at the last minute. The American people are not going to have any patience for a politically self-inflicted wound to our economy,” he added.

The American public is indeed low on patience. But that impatience pales in comparison to their general lack of knowledge regarding economics, and the subtleties of the fiscal cliff deal and the upcoming debt ceiling negotiations, in particular. Nothing epitomized that lack of knowledge better than the shock expressed by the legions of Obama’s supporters when they discovered that the tax increases they heartily supported when they thought it was all about making the “rich” pay “their fair share” included a bite out of their own paychecks. Somehow the president and his media enablers failed to mention that the expiration of the payroll tax holiday, raising the rates from 4.2 percent back up to 6.2 percent, was part of the equation.

That lack of understanding invariably works to the president’s advantage with respect to the debt ceiling debate. Thus, the president can once again chide Republicans in Congress with pithy phrases such as, “You don’t go out to dinner and eat all you want and then leave without paying the check,” or ”I don’t think anyone would consider my position unreasonable. I’m not going to have a monthly conversation of whether we will pay our bills,” even as this administration can neither pay for its “dinner check” or its “monthly bills” without massive amounts of borrowing that now comprises a mind-bending 46 cents of every dollar spent in FY2013, which began October 1. In October and November alone, the government rang up another $292 billion in deficit spending–as in $4.8 billion of borrowed money per day.

Yet at the press conference, the president insisted that his administration has already cut more than $1 trillion in federal spending. He said the same thing in a December 30 appearance on NBCs “Meet the Press.” ”Well, I have to tell you, David, if you look at my track record over the last two years, I cut spending by over a trillion dollars in 2011,” Obama told host David Gregory. That is a flat out lie. The White House Office of Management and Budget (OMB) not only revealed that the federal government increased spending by $147 billion from FY2010 to FY2011, but added another $1.29 trillion to the national debt–which is the primary reason the nation has once again bumped up against the debt ceiling.

Even more remarkable than the president’s ability to lie without the slightest hesitation, is the mainstream media’s abject failure to call him on it. Whether this is an error of commission, as in a failure to obtain budget information that is readily available, or an error of omission, meaning they have the information and refuse to bring it up during a high-profile press conference, hardly matters. The public hears $1 trillion in cuts, and the contention is left unchallenged. Thus, Americans are forced to endure a media that is ignorant, collaborative or both.

As we get closer to the debt ceiling, nothing will change. Thus, when the president begins his opening round of debt ceiling “negotiations” by warning the public that Republicans “will not collect a ransom in exchange for not crashing the American economy,” no one is willing to explain that the only way the economy crashes is if the president orders it to happen. The NY Post’s Carolin Baum explains that the tax receipts government takes out of Americans’ paychecks each month far exceeds what the government owes in monthly interest payments. Furthermore, despite claims by the Treasury it has no authority to prioritize payments to holders of U.S. debt, the Government Accountability Office (GAO) reached the following conclusion in 1985: “We are aware of no statute or any other basis for concluding that Treasury is required to pay outstanding obligations in the order in which they are presented for payment, unless it chooses to do so.”

In other words, the only way America could default is if Obama issues an executive order to Treasury Secretary Tim Geithner, mandating that America’s obligations must be paid in the order they are received, even if it crashes the economy in the process.

Yet that didn’t stop the president from characterizing 2011′s debt ceiling negotiations in precisely that manner. When CBS News’ Major Garrett noted that Obama voted against raising the debt ceiling as Senator, even as he is adamant about raising it now, absent ”deficit reduction or budget maneuvers” that presidents Reagan, G.W. Bush and Clinton were willing to undertake, the president blamed “certain groups in Congress” for their “absolutist positions” that brought the nation “within a few days of defaulting.”

No it didn’t. It bought the nation within a few days of a likely government shutdown, during which serious choices would have to have been made regarding what the government could actually pay for, in addition to the interest on the debt. It is that conversation that the president, his party, and more than a few Republicans for that matter, are desperately trying to avoid.

Moreover, exactly as he did in 2011, the president is once again attempting to avoid that conversation by instilling fear in vulnerable and economically illiterate Americans, warning them that “Social Security benefits and veterans’ checks will be delayed” if the debt ceiling isn’t raised “quickly.” This is nothing less than Chicago-way thuggery designed to obscure the reality that the president could begin debt ceiling negotiations right now, even as he steadfastly refuses to do so.

The reason for such intransigence is simple. A combination of fearful Americans, a duplicitous media, and a Republican party with a track record of spinelessness will allow Obama to demagogue the issue without restraint. The purposeful failure to present an on-time budget is icing on the cake, in that it pushes any chance of negotiations closer to the deadline where the debt ceiling is raised, or the government shuts down–but does not default.

As of now, Republicans are talking the talk. “I do know that the most important issue confronting the future of our country is our deficit and debt,” said Sen. Mitch McConnell (R-KY).  ”So we are hoping for a new seriousness on the part of the president with regard to the single biggest issue confronting the country, and we look forward to working with him to do something about this huge, huge problem.” House Speaker John Boehner (R-OH) concurs. “The American people do not support raising the debt ceiling without reducing government spending at the same time. … The House will do its job and pass responsible legislation that controls spending, meets our nation’s obligations, and keeps the government running, and we will insist that the Democratic majority in Washington do the same.”

It won’t happen. Only the Republicans have to have enormous courage to take on America’s insatiable addiction to spending. Democrats and the president can sit back, hold veterans and elderly Americans hostage, and wait for their media apparatchiks to pile on a “heartless” GOP.

“If we want to have a conversation about how to reduce our deficit, let’s have that. We’ve been having that for the last two years,” said the president at yesterday’s press conference. During those two years, America’s debt has increased by more than $2.1 trillion. By the time this president is finished talking in 2016, the national debt will top $20 trillion. At some point, talk of “cliffs” and “ceilings” will cease to matter. Only the word “abyss” will be relevant.

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