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PRESIDENT’S BUDGET: GROUNDHOG DAY, AGAIN

March 04, 2014

By Thomas Fletcher

In an exercise that is beginning to look reminiscent of the Bill Murray classic Groundhog Day, President Obama released his fiscal year 2015 budget plan this week. Like each of the President’s five preceding budget blueprints, this year’s edition is short on meaningful reform — piling up deficits and adding to our already crushing national debt. And like five of the last six White House budgets, this year’s retread plan was released late — signaling just how low of a priority this administration places on restoring fiscal sanity and curbing runaway federal spending.

It is discouraging but not surprising that President Obama has once again missed an opportunity to put forth a realistic budget proposal. What that the President is offering is once again nothing more than a replay of the last six years – years in which debt has soared, economic growth has sputtered, and job creation has lagged.

This budget calls for more spending, higher taxes and perhaps most disappointingly, no serious reforms to ballooning entitlement programs. Furthermore it raises the fundamental question of whether the President is serious about addressing the fiscal challenges facing the country.In short, by failing to address spending and entitlements and using tax hikes as quick fixes, the President’s budget has missed the mark yet again.

Spending
In previewing this year’s budget, the White House said that it would call for an end to the “age of austerity” — a laughable reference, given that past budgets proposed by this White House have run up trillion dollar deficits. Even so, this year’s Obama budget steps back from even the most modest efforts that have been undertaken to curb spending. After busting the spending caps put in place by the Budget Control Act with the Murray-Ryan budget deal, the President wants more. In the President’s nearly $4 trillion budget, there is tens of billions of dollars in new spending on various domestic programs including job training and increasing federal workers pay. The President’s pork barrel budget also contains a stimulus-esque calls for hundreds of billions more in infrastructure spending, and an expansion of wealth transfer payments such as the deceptively-named Earned Income Tax Credit.

Taxes
To finance his higher levels of spending, the President is calling for tax hikes in the form closing loopholes and deductions in the tax code. Specifically, he wants to end the tax break allowing the self-employed to not pay taxes on Medicare and Social Security. Moreover, this year’s misguided proposal does nothing to lower tax rates on individuals and business, a key step that must be taken to trigger economic growth and job creation. In fact, the proposal moves in precisely the opposite direction, raising taxes and fees – without a doubt the worst possible prescription for an already sluggish national economy.

Entitlements
In perhaps the most disappointing part of the budget, the President leaves runaway entitlement spending untouched. There are no proposals to reform Medicare, Medicaid, or Social Security. Even the very minimal olive-branches the President has put forth in recent years, such as so-called “Chained CPI,” (a cost-bending measure to rein in the growth of spending on Social Security) is gone –confirming that Mr. Obama has no interest in working with lawmakers to get control of the key drivers of our national debt. Given that it’s an election year it would appear the President is more interested in scoring political points with his base than in reducing the financial burden on young people and the future generations of Americans.

This proposal is proof positive that this administration is interested in preserving the status quo of higher taxes and more spending. And that’s too bad. Kicking the can further down the road shouldn’t become the new normal when it comes to living within our means and ensuring economic opportunities for American families. Taxpayers deserve a budget that will lead to prosperity and economic growth, not debt and stagnation.

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