The federal deficit is growing at an alarming rate. Without some correction, our deficit will continue to explode. The deficit for the next two years is projected at more than $1 trillion annually, and the overall deficit projection for the next decade is more than $7 trillion. Deficits like this are unsustainable and only lead to a downward cycle of forcing us to take on more debt.

Not only do interest payments on this debt threaten to overwhelm the budget, but if our national debt continues to skyrocket to somewhere between 75 percent and 95 percent of gross domestic product over the next decade (far beyond the 60 percent that most economists consider the highest level of sustainable deficit), it threatens America’s credit rating. A downgrade in the country’s credit rating would create an economic crisis that would make the last two years seem like a dress rehearsal for something devastatingly bigger.

Voters understand this problem. A recent CBS poll found that 56 percent of the country realizes that the deficit needs immediate action. This is where things get tricky because Republicans have long believed that attacking the deficit should coincide with an attack on the social safety net through cuts to federally funded Social Security, Medicare, Medicaid and education.

Unfortunately for Republicans, hardly anyone seems to agree with them. CNN found last month that less than 25 percent of people support cuts from any of those areas in order to reduce the budget deficit. As a result, Republicans have instead pivoted to “deficit reduction” through cuts to nondefense discretionary spending.

In doing so, the GOP Conference leadership avoided identifying specific programs — worried that voters would balk once they knew which programs face cuts — and instead offered across-the-board cuts that avoid the hard choices. They coupled this with budget-busting tax cuts for the wealthiest 2 percent and an effort to repeal a health care law that would reduce the deficit by over $200 billion.

This is not a serious approach to reducing the deficit.

Nondefense discretionary spending makes up less than half of discretionary spending. More meaningful cuts should come from bloated defense spending, for example, a cut supported by 50 percent of the voters.

More importantly, the Republican rules package, the rules that the majority party sets for the House at the beginning of each Congress, specifically took the cost of the wars in Iraq and Afghanistan off-budget. Stopping our enormous open-ended investment in Afghanistan would reduce our long-term debt by more than $1 trillion and do more to cut the deficit than any of the Republican Party’s supposed deficit reduction efforts, such as the Republican bill to end public financing of campaigns.

Rep. Tom Cole (R-Okla.), my colleague on the Budget Committee who introduced that bill ­— H.R. 359 ­— estimated that it would save $617 million over 10 years. That’s roughly the same savings we would realize in two days from ending our involvement in an endless war in Afghanistan. Every day we stay in Afghanistan, we add more than $325 million to our debt.

The crisis is the cost of future entitlements and defense, about which Obama proposes nothing. Yes, there's some blather. But Obama will not risk in any way any vulnerability on taxes to his right or entitlement spending to his left. He convened a deficit commission in order to throw it in the trash. If I were Alan Simpson or Erskine Bowles, I'd feel duped. And they were duped. All of us who took Obama's pitch as fiscally responsible were duped.

The cynical political calculation is obvious and it is well put by Yglesias and Sprung. If Obama backs Bowles-Simpson, the GOP will savage him for the tax hikes, while also scaring the wits out of the elderly on Medicare. The Democratic left - just look at HuffPo today - will have a cow. Indeed, if Obama backs anything, the GOP will automatically oppose him. He has to wait for a bipartisan agreement which he can then gently push ahead. But that's exactly why we are in this situation today.

Obama's game is transparent, isn't it? He is playing a game of chicken. He puts forward a series of proposals that he knows are more or less insane; but he also believes that Republicans will come to his rescue. They, not being wholly irresponsible, will come up with plans to reform entitlements--like, for example, the Ryan Roadmap. Ultimately, some combination of those plans will be implemented because the alternative is the collapse, not just of the government of the United States, but of the country itself. But Obama thinks the GOP's reforms will be unpopular, and he will be able to demagogue them, thus having his cake and eating it too. Is that leadership? Of course not. But it is the very essence of Barack Obama.

Obama's budget proposal is a remarkably weak and timid document. He proposes to cut only $1.1 trillion from federal deficits over the next decade - a pittance when you consider that the deficit this year alone is in the neighborhood of $1.5 trillion. The president makes no serious attempt at cutting entitlement programs that threaten to drive the government into insolvency.

Contrast that with the proposal by the heads of Obama's fiscal commission, who outlined a way to cut $4 trillion from deficits through 2020, rein in entitlement spending, overhaul the tax code and reduce the government's debt load. As commission co-chair Erskine Bowles, former chief of staff in Bill Clinton's White House, told The Post's Lori Montgomery, Obama's budget is "nowhere near where they will have to go to resolve our fiscal nightmare."
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The best explanation the White House has come up with, uttered privately, is that Obama didn't want to step out too far with politically unpopular cuts before congressional Republicans propose their own. And it's true that Republicans haven't yet committed to including entitlement reforms in their own 2012 budget. But even that doesn't justify Obama's feeble budget document, which squanders the little momentum built up by the fiscal commission.

As administration officials came out to defend the indefensible budget Monday, they had little to work with beyond cliches.

"The budget that we sent to Congress today is a responsible plan that shows that we can live within our means and we can also invest in the future," Lew began.

GMTom wrote:The problem isn't just Obama, it isn't just Democrats, Republicans (so far) have failed to do anything but talk about the problem either. Hey, at least they are talking about it and at least they SAY the right things but what have they really done? That answer is the same thing as the Democrats ...nothing.
Stop talking, start doing!
That can force the Democrats to follow suit, but my feeling is nobody wants to really be the one to make such hard cuts, they will certainly be tough to do, for every program slashed they lose voters and the only way to do anything substantial will entail affecting everyone so it hurts us all and when it hurts, the fear is we will retaliate with our votes going to the other guys.

Neal Anderth wrote:Bankruptcy is an excellent solution to insolvency. SS, Medicare, and basic defense can all be paid out of current revenues. Fractional reserve banking is all theoretical anyways. They want us to believe that bankruptcy is impossible and that someday we must enslave ourselves for the good of the banking/debt system. It's a paper tiger at best.

I would imagine that very little will happen till 2012, no one wants to give the other side a leg up in the upcoming election

Ray Jay wrote:One other important thought. When more baby boomers such as myself start to retire and collect social security and medicare (or at least get closer and think about it some more) it will get even harder to cut these programs. Once you are on the dole, so to speak, it is very hard to say, no thanks, cutting the deficit is more important.

“The one that we can solve right now if we get together in a sensible kind of way is the amount of debt we’re working with on an annual basis, our annual deficits,” The president said. “My budget freezes spending for five years and what that does is solve the short term problem by saying we’re not going to spend anymore money than we’re taking in. That requires some painful cuts in certain areas, some cuts that I’d prefer not to have to do, but I think it’s important for us to get that right.”

In other words, Obama’s budgets don’t actually cut overall spending at all. Spending rises by 30% in real terms over the ten-year projections, and publicly-held debt (which excludes that held by the Social Security Administration) rises by 57% in the same period. Instead of limiting mandatory spending, Obama attempts to hide discretionary spending by transferring pet areas of spending into the mandatory category. It’s a three-card Monty attempt to distract from Obama’s agenda of continued federal spending and regulatory adventurism while claiming fiscal responsibility.

How many times does a politician get to repeat an easily disprovable “factually incorrect” statement before it can be called a lie?

danivon wrote:That $1.1T projection is lower than the 2011 deficit. Looks like things are improving.

Do you expect a deficit to be eradicated in two years, during a period of recession and nascent recovery? It's simply not possible to do.

I should remind you that before Obama took office, the budget deficit was projected to be well over $1T. So clearly it must be his fault for inheriting it.