It’s the economy, stupid: New deficit projections pose risks to Obama’s agenda
Monday, August 24th, 2009The devil is in the details. But who’s paying attention?
Reuters reports:
President Barack Obama’s domestic policy proposals will face the reality of skyrocketing deficits on Tuesday when officials release two government reports projecting huge budget shortfalls over the next decade.The White House budget office and the Congressional Budget Office (CBO), a non-partisan arm of Congress, release updated economic forecasts and deficit estimates on Tuesday, providing further fiscal fodder to opponents of Obama’s nearly $1 trillion healthcare overhaul plan.
. . .The White House has confirmed that its deficit estimate for the 2009 fiscal year, which ends September 30, will inch down to $1.58 trillion from $1.84 trillion after eliminating billions of dollars originally set aside for bank rescues.
Looking forward, an administration official told Reuters the 10-year budget deficit projection will jump by about $2 trillion to roughly $9 trillion from an original forecast of $7.1 trillion.
Just off by $2 trillion. What’s the big deal?
UNSUSTAINABLE TRAJECTORY
“We’re still on a long-run trajectory that’s not sustainable,” said Rudolph Penner, a fellow at the Urban Institute and former CBO director from 1983-1987.
“In an ideal world they would be doing a lot more to get health costs under control and, in my view, we wouldn’t be talking about expanding coverage right now,” said Penner, who describes himself as a moderate Republican.
The CBO had previously forecast that deficits between 2010 and 2019 would total $9.1 trillion, generating heat for the White House, which stuck to its original $7.1 trillion forecast earlier this year. The new number will bring White House projections into line with the CBO, the official said.
Every year and every election, for as long as anyone can remember, every president and every politician has talked about bringing “costs under control.” We have yet to see it. Only broken campaign promises and the false hope for “change.” But there is something you can believe in: The government beast must be fed — and the bigger it gets, the more it needs to consume. (more…)