White House Budget Director Orszag on the Perils of Budget Deficits…Under George Bush
Morgen on May 7, 2009 at 9:05 pm
Today the White House rolled out the full details of their $3.6 trillion budget plan for fiscal year 2010. Of course only in the Orwellian world we now seem to be living in would a budget plan with an expected deficit as high as $1.5 trillion be branded as a “New Era of Responsibility“. In predictable fashion, the White House attempted to put the focus on a $17B package of supposed budget “cuts”, many of which aren’t even expected to survive the actual appropriations process in Congress. And of course $17B is small change compared to the near across the board increases in discretionary spending defined throughout the budget.
Which brings us to the key emissary of the Obama budget plan, Peter Orszag, the Director of the Office of Management and Budget (OMB). Prior to his OMB appointment by Obama, Orszag was the Director of the Congressional Budget Office (CBO) where he was widely regarded – and respected – as a budget deficit hawk. Judging by his spin on the budget plan released today, Orszag apparently has deluded himself into believing that this is still the case. For the benefit of Mr. Orszag, and all the other budget Kool-Aid drinkers, let’s take a little walk down memory lane and see what Orszag had to say about an expected $400B (!) deficit under George Bush in 2004:
The danger Orszag was warning about in 2004 was the role that government budget deficits play in reducing national savings, and crowding out investment and production within the private sector. A point he just as easily could – and should – be making today. In fact, with the 2010 deficit expected to be almost 400% higher than in 2004, he should be shouting it from the rooftops! But of course the Obama Administration does not care about the private sector, and so instead we get a dog and pony show touting fictitious budgets cuts and phony platitudes about responsibility.
Over the past couple of months I’ve reviewed a lot of Orszag’s congressional testimony from his days running the CBO, as well as research he published in a previous role at the Brookings Institution. While it’s apparent to me that Orszag is a liberal at heart, I believe he is also a very good economist. I hold out a faint degree of hope that he will come around in the next year or two and see the fiscal catastrophe that the Obama Administration is inflecting on future generations of Americans. I just hope he puts down the Kool-Aid before it’s too late.
Hi Morgen,
Cuts are cuts. We obsess so much over comparison against prior presidents that we lose sight of the present. I think that we should forget precedent and focus on the fact that he is a liberal spender who is cutting spending, which is a good thing.
If we can learn as a nation to focus on the positive it will move the country ahead much more quickly.
Ryan
May 8, 2009 @ 6:26 amCuts are NOT cuts, when in practice a substantial number of them will never be approved by Congress. And more importantly, it is duplicitous for the Administration to attempt to put the focus on these “cuts”, when by and large the overall budget represents a tremendous increase in government spending. What exactly is the positive that we should be focusing on here?
May 8, 2009 @ 12:52 pmMorgen is right. This is the same tactic they used last month. Obama came out promising to “cut the deficit in half by 2012). Of course half of his deficit is still double the deficit we had under Bush.
It’s spin. And of course the media are happy to let him get away with it.
May 8, 2009 @ 2:26 pmRyan, the cuts are not nuts. That money will be spent elsewhere because it has to be spent elsewhere.
“The President already proposed a specific discretionary spending level, and Congress has already approved a budget that would spend $1,086 billion on regular discretionary spending in FY 2010. The discretionary savings proposals affect only the composition of such spending. Thus, even if the entire $12.5 billion in discretionary spending cuts are enacted, the savings would automatically be plowed into other programs to maintain discretionary spending at that level.” -The Heritage Foundation
Some of the so-called cuts are also coming from projects that were funded by the stimulus package, so if the cuts pan out they are more like a stop-payment. Read: http://www.usatoday.com/news/washington/2009-05-07-budgetcuts_N.htm
May 8, 2009 @ 2:44 pm[...] is that President Obama is on course to double the national debt in just four years. After years of complaining about annual deficits of $300 billion or $400 billion and their effects on inte…, liberal commentators are suddenly silent now that the deficit is heading toward $2 trillion under [...]
May 10, 2009 @ 8:20 am