America has a budget crisis, bigger and more dangerous than the fiscal cliff. I’m reading the latest report from CBO from August 22, 2012 as we finalize our draft chapter on America’s imbalance (Chapter 12 as currently organized). This kind of spending is an existential threat, much bigger than external threats. It echoes the kind of imbalances that brought down great powers in history.
Let’s not forget that President Obama promised to cut the deficit in half during his first term, and he made this promise in February 2009, during the recession, when the scope of the problem was well known:
And that’s why today I’m pledging to cut the deficit we inherited in half by the end of my first term in office. This will not be easy. It will require us to make difficult decisions and face challenges we’ve long neglected. But I refuse to leave our children with a debt that they cannot repay — and that means taking responsibility right now, in this administration, for getting our spending under control. (emphasis added)
Here is the scorecard on Obama’s fiscal promises, according to the CBO: the deficit in 2008 was 0.5 trillion dollars. Federal outlays were 2.98 trillion dollars. Since then, the U.S. government has run deficits of 1.4, 1.3, 1.3, and a projected 1.17 trillion dollars during these last four years. And “spending under control” apparently meant “blowing a hole” through the federal pocketbook, with outlays of 3.5, 3.5, 3.6 and a projected 3.4 trillion dollars (through 11 months of the 2012 fiscal year). If a presidential promise falls in Washington, but the media refuses to notice, does it make a sound?
Instead of cutting the deficit in half, Obama has tripled it. Instead of controlling spending, he’s raised outlays by half a trillion dollars a year, which will get much bigger when the health care law takes effect. Instead of a temporary stimulus to bridge the nation back to full GDP, we have a permanently stimulated federal government and zero recovery.
It is entirely understandable that the deficit was not fixed in the first year that Obama was in the White House, the second year, the third year, and even the fourth year. What is not understandable is the absence of any coherent long-term plan, partisan or bi-partisan, to address the issue. What America got instead was another blue-ribbon commission (Simpson-Bowles) that was ignored before the ink on its final report was dry.
Ironic that the President has time to tweet about the decision made by referees during the Monday Night Football game to take away the interception by a Packers player and give a bogus touchdown to Seattle. Sure, the refs made a bad call. They neglected to huddle up, calm down, and clarify the situation. But here’s the thing: the refs were managing a game, making a split-second call. In contrast, the White House had four years to huddle up, calm down, and make a plan about the deficits. Yet, nothing. There’s not even a sketch of how the White House would address this issue any differently than it has for the last 45 months. It’s just frustrating to see how football gets more presidential attention than the debt my children will pay.