Alabama Senator Jeff Sessions described President Obama’s proposed 2012 budget as “debt on arrival,” a pithy assessment of a plan that seems to have virtually no chance of being passed. The $3.73 trillion spending plan exceeds the Republican’s budget target of $2.9 trillion by more than $800 billion. Recall that, even with majorities in both houses of Congress last year, the president had a tough time getting his 2011 spending bill passed. With the GOP in control of the House and with national anxiety over unsustainable national debt rising, it’s hard to see how this plan is going to go anywhere.
The Washington Post’s Ed O’Keefe broke down some of the details. Though the plan is supposed to ultimately cut the deficit by $1.1 trillion over the next ten years, that figure falls far short of the $4 trillion in deficit reduction that the president’s own debt commission said was necessary to avoid fiscal catastrophe over the course of the decade. Additionally, most of the $1.1 trillion in deficit reduction comes on the back of $1.6 trillion in new revenue, most of that coming in as the result of higher taxes. The wealthy, businesses, the oil and gas industry, financial institutions and hedge funds would all be subject to higher taxes if this budget were to be passed.
Perhaps most importantly, the president’s proposal does nothing to address the two-headed 800 pound gorilla lurking in the room: Medicare and Social Security, the massive entitlement programs that account for the bulk of federal spending. Most everyone acknowledges that the federal budget cannot be brought under control until someone is willing to step on those two third rails of American politics. The president’s proposed budget makes it clear that he wants and expects Republicans to take the first step in that direction, a political consideration that may prove important when it’s time to play the blame game after cuts are made.
Will the GOP actually have the courage to make a stab at entitlement reform in a counter-proposal? House Majority Leader Eric Cantor says they will. In an interview posted at his website, Cantor responded to a question about whether or not the GOP’s proposed budget would include entitlement reforms this way:
Your question about the budget itself and the entitlement inclusion, yes, we will include entitlement reform provisions in our budget, again, unlike the President, and unlike Harry Reid who doesn’t even admit there needs to be any reform of Social Security.
We are going to lead. That is why I said the President missed an opportunity to lead today, to try and address the biggest fiscal challenge we have. And so we are going to lead and include that in our budget.
Some observers think that there is a reason that the president’s proposed budget seems to be so out of step with the mood of the nation: it’s not so much an actual proposal as it is a negotiating ploy. As Chris Stirewalt observed at Fox:
By entering his opening bid on spending so high, Obama is hoping to produce a final result that preserves some of his agenda. Yes, the administration knows that money for high-speed trains and solar panels will likely get shaved off, but as in any negotiation, the administration has come to the table with some padding built in.