Stupid Budget Tricks
By Bernie Horn
March 24, 2009 - 11:08am ET
President Barack Obama’s budget is under furious attack in Washington—because it seeks to right the wrongs of the Reagan-Bush era.
The President’s budget would rebalance the tax code so that the very wealthiest citizens, only those earning over $250,000 per year, would see their taxes increase. Ninety-five percent of Americans would get a permanent tax cut. In fact, this would be the biggest middle-class tax cut in history.
The President’s budget would close multi-million dollar tax loopholes for big oil companies. It would stop unjustifiable subsidies to huge banks, insurance companies, and agribusinesses. And it would use a variety of devices to drive down the absurdly high prescription drug prices charged by the pharmaceutical industry.
The President’s budget would make a $634 billion down payment on fixing our nation’s ailing health care system. It is the first essential step toward lowering the cost of health care for all and ensuring that—finally—every American is covered by health insurance.
The President’s budget would institute a “cap-and-trade” system for carbon emissions. This is the first step toward a system that will effectively deal with global warming. It also makes huge strides toward energy independence by investing in clean energy and creating millions of green jobs that can never be outsourced.
The President’s budget would greatly increase federal support for public education. It would provide the largest increase in history for college grants. It would totally overhaul the federal student loan program so that taxpayer funds subsidize college students instead of banks. And it would invest in early childhood education and public school programs to pursue the goal that every child has access to a quality education.
In short, this budget could be one of the best measures passed by Congress over the last 40 years. But only if it passes relatively intact.
Republicans can’t kill this budget, only Democrats can. The Budget Resolution operates under special rules—it is NOT subject to filibuster. So the budget can easily pass both the House and Senate without a single Republican vote.
Unfortunately, there are dozens of Democrats, including about 20 in the Senate, who have in one way or another threatened to block, slice, or water down important parts of the President’ budget. Let’s hear from a few of them:
Senator Evan Bayh (Indiana) talking about Obama’s tax increases for the wealthy: “I do think that before we raise revenue, we first should look to see if there are ways we can cut back on spending. The American people and businesses are tightening their belts,” Bayh added. “I think we need to show that the government can economize as well.”
Senator Kent Conrad (North Dakota), the Chairman of the Senate Budget Committee, explaining why he plans to cut in half Obama’s increases in discretionary spending: “When you lose $2.3 trillion on a revenue forecast, then you have to change and budget.”
Senator Bill Nelson (Florida), a member of the Budget Committee, referring to the Obama budget in an interview on Fox News: “We’re going to have to go back and rework this whole thing, and that’s going to be done this week in the Budget Committee.”
Senator Mark Begich (Alaska), saying that he wants to limit new spending in Obama’s budget to only one year: “If it’s coming and staying, then I have a problem.”
Senator Claire McCaskill (Missouri), expressing concerns about relatively small budget deficits: “We need to be careful not to use the economic crisis to get into bad habits.”
Senator Blanche Lincoln (Arkansas), expressing the same: “I’m proud to…serve as a voice for fiscal responsibility.”
Senator Ben Nelson (Nebraska): “I have major concerns about trying to raise taxes in the midst of a downturn of the economy.” At the same time, “Nelson is already opposing Obama’s budget because of education provisions that would end federal support for private student loans and divert the money into grants” because one of the major corporate providers of student loans is based in Nebraska.
Senator Joe Lieberman (Connecticut), officially an Independent who caucuses with the Democrats, predicted: “There’ll definitely be movements by moderate Democrats to impose fiscal responsibility,” says Lieberman. “I’m not sure what form it’ll take, but we’ll start to try to cut back and also put some brakes in place as we go on.”
Get the picture?
The problem is that all these complaints about the deficit are absurd. We are currently in the deepest economic downturn since the Great Depression. Basic macroeconomics tells us that federal deficit spending is essential to offset plummeting private-sector spending. This is precisely the right time for our federal government (and governments around the world) to spend money in order to lift the economy and get unemployed people back to work.
Paul Krugman and other economists have told us repeatedly that the stimulus package enacted by Congress in February was too small. A little bit more deficit spending in fiscal year 2010 (which runs from October 1, 2009 to September 30, 2010) is a good thing.
Please click here to go to a web page set up by the Campaign for America’s Future that makes it easy for you to contact the disloyal conservative Democrats in both the House and Senate. Tell them we elected Barack Obama to bring change to Washington—and they should stop blocking the way.
The writer is a Senior Fellow at Campaign for America’s Future and author of the recent book, Framing the Future: How Progressive Values Can Win Elections and Influence People.
Help us spread the word about these important stories...
Email to a friend
Views expressed on this page are those of the authors and not necessarily those of Campaign for America's Future or Institute for America's Future