Deficit reduction a la Obama

A plan?

President Obama’s Deficit Reduction “Plan”

My comments on various details – in italics.

If the current budget is not reduced, budget debts will add up to $7,000 billion over the next ten years. President Obama has proposed a plan to cut $4,000 billion over the next 12 years – $3,000 billion in cuts, with $1,000 billion in additional revenues (taxes, that is).
This is a typical ploy – propose action over a very long term, much of which will be left to whoever takes over after the current president is long gone. If we’re lucky, he’ll be gone in January of 2013; if not, it will be January of 2017 – and the Titanic may be at the bottom of the ocean. So, very little action right away. Obama has expressed almost no concern over the current debt and budget deficit.
And, if my math is correct, that’s 3 more trillion dollars added to the debt. Just what we need.

He mentioned a “trigger” law that would automatically enact spending cuts if things haven’t stabilized by 2014. Of course, Congress will have to pass such a law, and a future Congress has to go along with it.
Lots of luck on that one.

The president says Social Security does not contribute to the country’s deficits but that both parties should work together to strengthen it without putting current retirees at risk or “slashing benefits for future generations.”

What do you know? That’s exactly what Paul Ryan’s plan, which Obama bashed and called ‘extreme’, wants to do. The President, as usual, left the details up to Congress. Leadership entails making useful suggestions; Obama made none. He also told an untruth: Social Security is now paying out more than it receives in revenue.

I don’t believe in any plan that calls for both parties to work together. Not in this political climate.

The President conveniently ignores demographics, which tell us the population is aging (I know I am) so that more and more people will be on Social Security, and fewer and fewer workers will be paying into it – it will become an increasing burden on the budget. We need to reform it ASAP.
In this area Obama is either being deceptive or stupid. He suggests we can cut Medicare and Medicaid by $30 billion a year for ten years. This is in addition to his unconstitutional Obamacare bill, which expects to cut another $50 billion over ten years.

Doesn’t he realize that the government is on the hook for every new person who reaches elderly status, or in the case of Medicaid adds to that burden? Has he heard that the elderly population is growing? Sure he has. It will be increasingly difficult to hold the cost down, because of that.

The president’s plan almost contains specific suggestions: he wants an independent advisory board to hold down growth in Medicare spending (in other words, ration it); he wants to use Medicare’s bargaining power (whatever that is) to hold down prescription drug costs; and discusses setting limits on Medicaid payments for certain medical devices (such as bandages?).

No significant cuts mean that Medicare and Medicaid costs will continue to spiral out of control.
He wants an “overhaul” of the tax system that would eliminate tax breaks and loopholes and even lower some tax rates, resulting in $1 trillion in additional revenue.
He wants Bush-era tax cuts to expire for individuals making $200,000 or more a year and couples making $250,000 or more, at the end of 2012. This will boost revenue, if it happens. The House will no doubt pass an extension, and he will no doubt veto it if it passes the Senate.

Thank God for class warfare. Without it, the Democrats wouldn’t have any issues at all.
Tax the rich, while about half of the workers pay 2% of the taxes.

Obama seeks to pare $400 billion from defense spending by 2023. The White House says he will work with Pentagon officials to identify specific cuts.

That would be the first specific thing he’s ever done.

Obama wants Democratic and Republican leaders in the House and Senate to designate four members each to participate in negotiations led by Vice President Joe Biden. This would happen in May. They will supposedly work on a plan for comprehensive deficit reduction by the end of June.

I’d hate to be a Republican on that committee. Their suggestions won’t go anywhere, and what could go wrong under Joe Biden’s astute leadership? And, they have nearly two months to get it done. And, if they do write something up, Obama, the House, and the Senate will all ignore it.
Demagoguing the Republican Efforts is Obama’s chief activity, now that he has swung into full campaign mode. Obama criticizes the Ryan Plan for aiming to “maintain tax cuts for the wealthy” while cutting deeply into education, clean energy and transportation programs the president says must be preserved to ensure the country’s competitiveness.

He acts as if the Department of Education has a positive effect on our standing in the world. Actually, grades have gone down since it was created, while DOE spends more and more money. Energy development should be left to the private sector, and the Department of Transportation isn’t doing much that is useful. All three departments should be cut back sharply if not abolished.

On health care, Obama would leave Medicare and Medicaid basically in their current form (but he wants to squeeze them, in an unspecified way) while Republicans would turn Medicaid into a block grant program for states and transform Medicare, beginning in 2022, by giving retirees a fixed amount of money to buy private insurance. The president said that “ends Medicare as we know it.”

We should end Medicare as we know it. That’s the whole point.

So, that’s Obama’s “plan”. A freshman in high school could probably write a better one. Needless to say, I am not impressed.

This entry was posted in Politics, Taxes, The federal deficit. Bookmark the permalink.

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