Obama's 2013 Budget: Bad Deficit Reduction, Good Politics

You can love President Obama's budget, or you can hate it, but one thing is for certain: It is not a terribly serious attempt at long-term deficit reduction. It raises taxes on a fraction of the population without reforming the tax code. It creates new stimulus programs without significantly curbing entitlements. It pays for new infrastructure projects with "savings from the Iraq war," which is a clever bit of parallel-universe budgeting, like me paying for a new suit with "savings from not going to Atlantic City tomorrow."

I've heard some people make the argument that, compared to the GOP presidential candidates, Obama's budget is strong on the deficit. Okay. I'm great at basketball, compared to a piece of spinach. Relative judgments aren't always the most illuminating.

Anyway, a strictly policy analysis of the president's budget misses the point. Nobody takes White House budgets seriously as roadmaps to a real budget. One consequence of this is that the White House doesn't have to write a budget that will pass. It only has to write a budget it can defend. And the White House has done that.

By sparing entitlements and sticking the burden of deficit reduction disproportionately on the armed forces and the rich, the White House has built a budget that it can sell to the public. When asked to identify the most important source of our deficits in a recent National Journal poll, 3 percent named senior entitlements, 24 percent picked defense spending, and 46 percent picked "wealthy Americans don't pay enough in taxes." The White House appears to be winning the deficit argument without getting too serious about the deficit. Neat trick!

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So yes, this budget is a political document. But if this poll is any indication, Josh Green sums up aptly, "it's pretty good politics."


Presented by

Derek Thompson is a senior editor at The Atlantic, where he writes about economics, labor markets, and the entertainment business.

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