Mr. Obama's Budget

By Mickey Edwards

Obama with econ advisers - Mandel Ngan.jpg

Years ago, the Congress assigned to the President the task of submitting each year a proposed federal budget. It has no force of law--deciding national priorities and spending levels remains strictly a congressional prerogative--but, like the President's State of the Union speech, which is also an assignment he is required (by the Constitution) to meet, it gives a pretty good snapshot of what the government's chief operating officer is thinking. This one may raise an eyebrow or two (it certainly raised both of mine).

Noticing that the country (actually, it's the government, not the country) is in a deep, deep financial hole, the President has proposed to shrink the outgo-income shortfall by raising taxes. The first part of that job, therefore, is to determine whose taxes to raise--everybody's (hardly palatable in an election year) or just those of a particular sub-group. The decision was easy, especially given the worldview, common among so many Democrats, that high earners are ipso facto the bad guys of society, even if that income has been earned by hard work at two or more simultaneously-held jobs and is offset by the non-frivolous but non-deductible needs of loved ones (these incidentals are not taken into account). So how to determine who are the baddest of the bad guys. The apparent conclusion: anybody who earns at least $250,000 a year.

If we raise taxes on everybody who earns $250,000 a year, and do not raise taxes on people making less than that, this is the result. Members of Congress (at least those who choose not to file jointly with working spouses) will avoid any tax increase (the congressional salary is, surprise, below the "bad guy" threshold; since members of Congress are prohibited from earning outside income, they thus escape the higher taxes they assess on others). If, however, taxes were to be increased for everybody earning over, say, $150,000, members of Congress and members of the President's Cabinet would have to raise taxes on themselves, too, and the government would bring in a lot more revenue to close the gap. Wonder why the President didn't think of that.

And here's another thought. The problem--the President says so and I agree--is that we have too large a federal deficit. So the President, in response, has submitted a budget that will apparently increase the deficit off and on for years to come. There's a magic there, but I'm not quite sure I know what it is. One of his proposals (nice-sounding but semi-serious; it does not prevent the upward trajectory of the deficits) is to freeze "discretionary" spending (non-entitlement spending that is meted out annually by Congress) for three years or so. But it is the height of irresponsibility to treat each discretionary budget item as identical in value and need. It is an approach that avoids hard choices, which has some political appeal, but in truth some programs absolutely need funding increases while others should be reduced, and it is the job of the Congress and the President to do the hard work of separating wheat from chaff. Instead, the Obama strategy would block the truly needy programs from getting the resources they require and, at the same time, would block reductions in spending for programs that have outlived their usefulness or have spent beyond defensible limits. An across-the-board anything is, almost by definition, a de facto failure to meet the responsibilities of governing; it's a cop-out but one to which the President seems determined to avail himself.

Finally, there's this. In his State of the Union speech, Barack Obama, the President of the United States of America for more than a year now, repeatedly blamed his, and our, misfortunes on his predecessor. And then he did the same thing all over again in his various speeches and pronouncements after the State of the Union address. And again when he unveiled his budget. His surrogates do it, too. "It ain't my fault" is the message of the day. I take a back seat to nobody in my disdain for the George W. Bush presidency which managed somehow to combine fiscal recklessness and a cavalier unconstitutionality in a single horrid package. But, in case the President has failed to look about his Big White Mansion, W ain't there. Hasn't been. It's been a year. Obama and Pelosi and Reid and sizable Democratic majorities in both the House and Senate and throughout the federal bureaucracy are already a fourth of the way through this presidential term. Granted, the President inherited a mess, but it's time to stop bemoaning the mess; Americans are bemoaning not the mess that was but the mess that is and seem more conscious than the Democrats do of exactly who is currently in charge and whose decisions are now shaping the economic landscape.

Mr. Obama's budget will be well received in Congress (after all, his party is in charge). The chairman of the House Appropriations Committee, David Obey, has already signaled a receptiveness to the President's proposals. Perhaps if the Congress adopts the presidential budget more or less as submitted, and appropriates and taxes accordingly, the Administration will start looking more honestly at the mirror in front of its collective nose rather than the rear-view mirror which seems to now hold its attention.


Photo credit: Mandel Ngan/Getty Images

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http://www.theatlantic.com/politics/archive/2010/02/mr-obamas-budget/35285/