I chewed on the President’s budget for a few hours today.  Rather than bore you with a MEGO (“My Eyes Glaze Over”) post filled with numbers and charts, I offer a few overall qualitative and strategic impressions.

• No big surprises here.  The budget tracks the State of the Union address as well as press events and leaks over the past month.  There are a few gems, including a hidden 25-cent per gallon gas tax, a State bailout and unemployment tax increase on almost all workers, and a $315 B unspecified Medicare savings gimmick, but those are to be expected.
• Spending, taxes, and deficits would reach new plateaus, each well above historic averages.  The President proposes sustained bigger government and bigger deficits and debt.  Much bigger.
• The numbers are terrifying.  That terror comes not from big new proposals, but from whistling past the graveyard of unsustainable current law.
• The President says his new goal is “to pay for what we spend by the middle of the decade.”  This clever language suggests he thinks that, since there was existing government debt when he took office, it is not his responsibility to find ways to pay for even the interest payments on that “inherited” debt.  As President, his job is not, however, after eight years to momentarily stop making things worse, as his budget proposes.  It is instead to address the challenges the Nation faces, including those that have been building over the past 70 years.
• In mid 2009 a smart friend observed that President Obama was pursuing an ordinary liberal domestic policy agenda at an extraordinary time in the economy.  It was as if the severe recession had almost no effect on the President’s outlook.  Indeed his chief of staff argued that the national economic crisis created an opportunity to enact the President’s campaign proposals.The same appears to be true with this budget.  The President is proposing an ordinary liberal spending agenda at an extraordinary time in our fiscal history.  His proposals for increased government spending on infrastructure, technology, and education are straightforward expansions of the role and size of government, in line with what I might expect from a Carter or even Clinton in his more expansive years.  Times have, however, changed significantly since the 70s and the 90s.  What were then long-term fiscal problems are now short-term looming crises.The fiscal problems of current law, which predate but were exacerbated by President Obama’s expansions of government in his […]