Yes, federal spending is a problem, Mr. President

posted at 1:21 pm on January 8, 2013 by Ed Morrissey

Is that in doubt? The Wall Street Journal reported late Sunday night that Barack Obama doesn’t think we have a spending problem, or at least that’s what John Boehner told Stephen Moore about Obama’s response to the fiscal cliff:

What stunned House Speaker John Boehner more than anything else during his prolonged closed-door budget negotiations with Barack Obama was this revelation: “At one point several weeks ago,” Mr. Boehner says, “the president said to me, ‘We don’t have a spending problem.’ ” …

The president’s insistence that Washington doesn’t have a spending problem, Mr. Boehner says, is predicated on the belief that massive federal deficits stem from what Mr. Obama called “a health-care problem.” Mr. Boehner says that after he recovered from his astonishment—”They blame all of the fiscal woes on our health-care system”—he replied: “Clearly we have a health-care problem, which is about to get worse with ObamaCare. But, Mr. President, we have a very serious spending problem.” He repeated this message so often, he says, that toward the end of the negotiations, the president became irritated and said: “I’m getting tired of hearing you say that.”

Investors Business Daily reminds the President today that math is hard, but pretty accurate … and that his own commission on deficits and debt told him the same thing:

That would be news to Obama’s debt commission, which in its final report made clear that spending is the driving force behind the nation’s debt crisis.

Here’s what the report said: “Even after the economy recovers, federal spending is projected to increase faster than revenues, so the government will have to continue borrowing money to spend.”

The panel added, “Over the long run, as the baby boomers retire and health care costs continue to grow, the situation will become far worse.”

And it recommended: “We should cut all excess spending — including defense, domestic programs, entitlement spending, and spending in the tax code.”

The commission was hardly breaking new ground here. Indeed, anyone who has looked at the federal budget can quickly see that out-of-control spending, not insufficient revenues, is the problem.

As the chart shows, even with the $620 billion in tax hikes Obama won during the fiscal cliff fight, plus the $500 billion in new ObamaCare taxes, spending will continue to outstrip revenues as far as the eye can see.

By 2022, federal revenues will top 19% of GDP, which is significantly higher than the post-World War II average. But spending will exceed 22%, and keep climbing.

Even if, as Obama apparently believes, the issue is entirely a health-care cost problem, it’s still spending.  And supposedly, ObamaCare was supposed to deal with the problem.  Instead, as Boehner notes in his interview, it makes the problem worse by creating even more spending on subsidies for premiums and more federal intervention in the market while aggravating the third-party-payer structure that is the fundamental problem.

The US has increased its spending from a historical level of 20% of GDP to 25% of GDP during the Obama presidency.  That’s a spending problem, and that plus the massive amount of unfunded liabilities soon approaching will make the current fiscal cliff look like late payments on a Sears card.  Michael Ramirez puts it into his Pulitzer-winning perspective today:

Also, be sure to check out Ramirez’ terrific collection of his works: Everyone Has the Right to My Opinion, which covers the entire breadth of Ramirez’ career, and it gives fascinating look at political history.  Read my review here, and watch my interviews with Ramirez here and here.  And don’t forget to check out the entire Investors.com site, which has now incorporated all of the former IBD Editorials, while individual investors still exist.

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Instead, as Boehner notes in his interview, it makes the problem worse by creating even more spending on subsidies for premiums and more federal intervention in the market while aggravating the third-party-payer structure that is the fundamental problem.

Yes, and what an interesting coincidence as this has been precisely MA’s experience with that botch of policy called RomneyCare on which ObamaCare is based. Yet there were people on this very site who tried to persuade me that Romney, and RomneyCare, were conservative or something.

casuist on January 8, 2013 at 1:26 PM

Why hasn’t anyone brought up the Billions spent daily on fraud, waste, abuse, and redundant bureaucracies…?

Seven Percent Solution on January 8, 2013 at 1:27 PM

What stunned House Speaker John Boehner more than anything else during his prolonged closed-door budget negotiations with Barack Obama

What in the name of God Almighty is that asshole Bonehead doing having “Closed-door” anything with Obama…

SWalker on January 8, 2013 at 1:27 PM

What stunned House Speaker John Boehner more than anything else during his prolonged closed-door budget negotiations with Barack Obama

What in the name of God Almighty is that ass.hole Bonehead doing having “Closed-door” anything with Obama…

SWalker on January 8, 2013 at 1:27 PM

But but but… if the rich pay “just a little bit more” everything will be sunshine, rainbows and unicorn farts.

Fenris on January 8, 2013 at 1:28 PM

Great as usual Ramirez!

bho thinks if he says enough times that there isn’t a spending problem the public will finally come around to his way of thinking? With the help of bhopress/d’s in dc, I just pray the US citizens don’t fall for that forked tongue lying snake bho!
L

letget on January 8, 2013 at 1:29 PM

All Kids Left Behind…because Obama ‘loves’ them so much.

Schadenfreude on January 8, 2013 at 1:29 PM

“At one point several weeks ago,” Mr. Boehner says, “the president said to me, ‘We don’t have a spending problem.

If someone’s goal is the bankrupting of America and the destruction of the republic – spending is indeed not the problem, but the solution.

Rebar on January 8, 2013 at 1:30 PM

May the avalanche get the fools.

Schadenfreude on January 8, 2013 at 1:31 PM

…those Ivy League Universities SCARE THE HE11 OUT OF ME!

KOOLAID2 on January 8, 2013 at 1:32 PM

Instead, as Boehner notes in his interview, it makes the problem worse by creating even more spending on subsidies for premiums and more federal intervention in the market while aggravating the third-party-payer structure that is the fundamental problem.

So why don’t you try to actually do something about it ya chain-smoking crybaby instead of caving on every friggin’ important issue?

You control the purse-strings.

(and not just the ones on your purse)

Tim_CA on January 8, 2013 at 1:32 PM

Why hasn’t anyone brought up the Billions spent daily on fraud, waste, abuse, and redundant bureaucracies…?

Seven Percent Solution on January 8, 2013 at 1:27 PM

Because Obama would have to stop hiring 101 of “his people” every single day, since Jan. 2009.

Schadenfreude on January 8, 2013 at 1:33 PM

Ramirez hits it out of the park yet again.

7%, stop being silly, there is no waste fraud and abuse, just evil Republicans demonizing dear leader.

D-fusit on January 8, 2013 at 1:33 PM

Investors Business Daily reminds the President today that math is hard, but pretty accurate … and that his own commission on deficits and debt told him the same thing:

The problem is simpler than that. Obama sees all this massive spending on the parasites as a moral issue. Fairness for the worthless takers of society- you know- Obama supporters. The rest of us see the math and say that we can’t afford all this crap. Obama doesn’t care because he’s delivering justice to the “downtrodden” of society. The ones that use their EBT cards at strip clubs and liquor stores.

Happy Nomad on January 8, 2013 at 1:33 PM

Starve the Looters!!!

Schadenfreude on January 8, 2013 at 1:34 PM

He repeated this message so often, he says, that toward the end of the negotiations, the president became irritated and said: “I’m getting tired of hearing you say that.”

Not nearly as tired as we are of the stupid stuff you say, Mr. President.

Bob's Kid on January 8, 2013 at 1:35 PM

What in the name of God Almighty is that ass.hole Bonehead doing having “Closed-door” anything with Obama…

SWalker on January 8, 2013 at 1:27 PM

Would you expect him to fellate Obama on C-Span?

Archivarix on January 8, 2013 at 1:37 PM

When you believe all good and necessary things happen through government tax and spend then every crisis has only one solution.

Speakup on January 8, 2013 at 1:40 PM

I’m not sure if Obama is delusional, but it seems if he doesn’t want to believe something, it can’t possibly be true.

Liam on January 8, 2013 at 1:40 PM

spending in the tax code.”

Paging George Orwell…

But seriously, this phrase makes my blood boil. I heard someone on MSNBC saying that the biggest driver of our spending is ‘spending in the tax code.’ Unbelievable.

Timin203 on January 8, 2013 at 1:42 PM

We are doomed…

PatriotRider on January 8, 2013 at 1:44 PM

“At one point several weeks ago,” Mr. Boehner says, “the president said to me, ‘We don’t have a spending problem.’ ” …

Do you suppose Boehner responded with a full-throttled counter argument … or simply wiped away a tear?

That degree of mental illness and evasion of reality right there should be grounds for removal from office owing to delusion and dementia (seems to apply as much to Boehner as Obama)… but, hey, we’ve permitted it for the past four years, so what could possibly go wrong with the next four?

As with all mentally ill individuals, you almost can’t blame Obama for actions based on a poorly-wired brain along with his inability to recognize such. It’s REALLY his enablers who are at fault (voters at the macro level, Dems and RINOs otherwise), and all owing to the “fatal conceit” (look it up, termed by Hayak) which seems to accompany these power-seekers/worshipers.

ShainS on January 8, 2013 at 1:44 PM

Obama doesn’t care because he’s delivering justice to the “downtrodden” of society. The ones that use their EBT cards at strip clubs and liquor stores.

Happy Nomad on January 8, 2013 at 1:33 PM

I know dozens of people on food stamps and other forms of assistance. The fraud goes way beyond using cash benefits at strip clubs. the NY Post article kind of alluded it to, but if you go to any bodega in an inner city, you can use your EBT card to buy booze, cigs, or get cash back. The clerks ring it up as bread or milk or whatnot, charge a small fee, and you get whatever you want in return.

And not a single person I know on food stamps NEEDS it. Most, like my cousins, are just lazy moochers who would rather party every day and live like they’re 18 then be responsible adults and get a real job. It’s not so much a matter of not being able to work or find work as it is not wanting to work, and not trying to find work. Food stamps change the incentives… Why work if all you care about is partying, and your basic needs will be met by the government?

Timin203 on January 8, 2013 at 1:48 PM

How could anyone who has the wherewithal to get himself elected as POTUS make a statement that says we don’t have a spending problem? How could he believe for one second that health care is the only problem and that he fixed it? I cannot believe that he is that stupid or that delusional.

I’m not sure we can survive four more years. Half the country reminds me of the movie “Idiocracy”.

kam582 on January 8, 2013 at 1:53 PM

Paging George Orwell…

But seriously, this phrase makes my blood boil. I heard someone on MSNBC saying that the biggest driver of our spending is ‘spending in the tax code.’ Unbelievable.

Timin203 on January 8, 2013 at 1:42 PM

MSNBC is obviously referring to the “rich” not paying their “fair share” but in all fairness “spending in the tax code” probably also includes idiotic crony-capitalist endeavors such as “wind energy” tax credits, which should be eliminated. So some real “spending in the tax code” is indeed a problem.

visions on January 8, 2013 at 1:55 PM

Second Look at Rick Perry

http://nation.foxnews.com/texas/2013/01/08/texas-shows-obama

gophergirl on January 8, 2013 at 2:00 PM

Dude, it’s what the people wanted. The people say there is no spending problem!

Xasprtr on January 8, 2013 at 2:00 PM

Ya know, as recently as last year I was dead set against the implementation of a VAT. I remain opposed to it if it is in conjunction with an income tax, but I’m pretty sure I won’t get my way in that regard. I have since changed my position. Before everyone starts calling me a dirty progressive commie, or something, hear me out. A VAT is imposed on the purchase of every good that is not food, correct? How best to get the leeches to fork over some of their money to the government? Right. Tax their purchases.

This is why I was strongly in favor of the Fair Tax, but I can see that’s not going anywhere.

Anyhow, since the progs want a VAT, thinking it will only hurt those with incomes, I say go for it. The drug dealers, the bridge card brigade (since one can apparently use them for everything), the pimps, other assorted holders of ill-gotten gains and those who pay no tax whatsoever, can finally have their very own skin in the game.

For those of us who can control our spending, I think it’s an option to get 100% tax compliance. A bitter, but possibly necessary, medicine.

totherightofthem on January 8, 2013 at 2:00 PM

I know dozens of people on food stamps and other forms of assistance. The fraud goes way beyond using cash benefits at strip clubs. the NY Post article kind of alluded it to, but if you go to any bodega in an inner city, you can use your EBT card to buy booze, cigs, or get cash back. The clerks ring it up as bread or milk or whatnot, charge a small fee, and you get whatever you want in return.And not a single person I know on food stamps NEEDS it. Most, like my cousins, are just lazy moochers who would rather party every day and live like they’re 18 then be responsible adults and get a real job. It’s not so much a matter of not being able to work or find work as it is not wanting to work, and not trying to find work. Food stamps change the incentives… Why work if all you care about is partying, and your basic needs will be met by the government?
Timin203 on January 8, 2013 at 1:48 PM

I could not agree more. I saw this during my career, and have a couple of relatives that want my hard earned money so they never have to work a day in their lives. I can’t believe that Obama wants more of what little money I have so he can give it to deadbeats.

kam582 on January 8, 2013 at 2:00 PM

The president’s insistence that Washington doesn’t have a spending problem…

The stupid is strong with this one.

Really, really strong.

UltimateBob on January 8, 2013 at 2:05 PM

What ever happened to Pay-GO ! you dishonest, purple lipped Marxist-raised Fraud Occupier of the WH ???

This Marxist tells so many lies, the media couldn’t keep up- even if they wanted too…..

FlaMurph on January 8, 2013 at 2:07 PM

Second Look at Rick Perry

http://nation.foxnews.com/texas/2013/01/08/texas-shows-obama

gophergirl on January 8, 2013 at 2:00 PM

.
It will have to be a Woman the Rs send up to face the Shillary 2016.
Don’t even think about running a man against the First Woman President- evah.
2016- The year of the Womens.

FlaMurph on January 8, 2013 at 2:13 PM

Actually, come to think of it…YOU’RE the problem.

Cleombrotus on January 8, 2013 at 2:15 PM

MSNBC is obviously referring to the “rich” not paying their “fair share” but in all fairness “spending in the tax code” probably also includes idiotic crony-capitalist endeavors such as “wind energy” tax credits, which should be eliminated. So some real “spending in the tax code” is indeed a problem.

visions on January 8, 2013 at 1:55 PM

Its a nonsensical phrase. So is “tax credits.” A tax is a law that government imposes that takes money from someone.

They’re talking about “deductions and exemptions” when they say “spending in the tax code” but they act like it’s normal spending. Congress set a high tax rate, then wrote in ways to get most people’s actual tax rate down to something managable. It doesn’t cost them ANYTHING, they’re just taking less of our money then they feel they good.

And tax credits are just hand outs (like welfare) from the government to people or businesses. The word ‘tax’ is misleading, since there is no taxing involved, just giving.

Timin203 on January 8, 2013 at 2:18 PM

I could not agree more. I saw this during my career, and have a couple of relatives that want my hard earned money so they never have to work a day in their lives. I can’t believe that Obama wants more of what little money I have so he can give it to deadbeats.

kam582 on January 8, 2013 at 2:00 PM

Yeah. I wake up every morning and go to work so that I can pay for myself and my life. My friends / family sleep in all day, party all night, and still get a per centage of MY pay check to live off, even though they did not to a per centage of MY work.

These are people I would NEVER give a dime to, not people that “need a hand up” or “through no fault of their own… blah blah” Through 100% fault of their own, these choose to live off others, and I’m forced to let them. So for every week I work, I spend the first 2 days workings to support them, and then get the last 3 days for myself. Hardly seems fair.

Timin203 on January 8, 2013 at 2:21 PM

It’s a Jedi mind trick!
These are not the ‘droids you’re looking for == we don’t have a spending problem.

Yeah. It seems he doesn’t have any problems spending other people’s money.

freedomfirst on January 8, 2013 at 2:22 PM

“At one point several weeks ago,” Mr. Boehner says, “the president said to me, ‘We don’t have a spending problem.

excerpt: Steven Moore article

.
If someone’s goal is the bankrupting of America and the destruction of the republic – spending is indeed not the problem, but the solution.

Rebar on January 8, 2013 at 1:30 PM

.
BINGO . . . that’s all that needed saying, close the thread.

listens2glenn on January 8, 2013 at 2:23 PM

I’m not sure we can survive four more years. Half the country reminds me of the movie “Idiocracy”.

kam582 on January 8, 2013 at 1:53 PM

I get depressed when I think about the fact the first four aren’t done yet.

freedomfirst on January 8, 2013 at 2:31 PM

Why hasn’t anyone brought up the Billions spent daily on fraud, waste, abuse, and redundant bureaucracies…?

Seven Percent Solution on January 8, 2013 at 1:27 PM

Because that’s obviously RAAAAAAAAACIST!!!

NapaConservative on January 8, 2013 at 2:38 PM

A VAT is imposed on the purchase of every good that is not food, correct? How best to get the leeches to fork over some of their money to the government? Right. Tax their purchases.

totherightofthem on January 8, 2013 at 2:00 PM

The problem with VAT is that it taxes the same good multiple times.

First you have the VAT on raw material. Then the VAT on the processed material. Then the VAT on the component that comes out of the factory. Then the VAT on the completed product. And finally the VAT levied directly on the consumer.

That’s a lot of taxation just to make the deadbeats, moochers, and other parasites finally contribute something to society. Far better to do it the bitter old-fashioned way and pare back on out-of-control spending and entitlement programs.

Happy Nomad on January 8, 2013 at 2:57 PM

That’s a lot of taxation just to make the deadbeats, moochers, and other parasites finally contribute something to society. Far better to do it the bitter old-fashioned way and pare back on out-of-control spending and entitlement programs.

Happy Nomad on January 8, 2013 at 2:57 PM

Oh yeah. I’d forgotten that bit. Back to the Fair Tax for me, then. Forget I ever posted. :)

totherightofthem on January 8, 2013 at 3:09 PM

The problem with VAT is that it taxes the same good multiple times.

And because of that, it adds considerably to the administrative and
compliance costs to all levels of production than that of a simple retail sales tax collected only at the final exchange of goods and services with the consumer.

hawkeye54 on January 8, 2013 at 3:11 PM

The Chosen One isn’t interested in anything beyond January 2016.

GarandFan on January 8, 2013 at 3:17 PM

I do think that Obama is a mathematical illiterate. He was not studying math in high school or college, he was getting high.

Fleuries on January 8, 2013 at 4:12 PM

I now welcome the avalanche, of course I was prepared for a cliff dive also.

Bmore on January 8, 2013 at 4:30 PM

Mind you, it will be a tough lesson. All this while insuring gun safety.

Bmore on January 8, 2013 at 4:32 PM

Of course it’s a spending problem. Nancy Pelosi and Harry Reid won House and Senate majorities in the 2006 elections by berating George W. Bush for “record deficits” and promising “no new deficit spending”. In 2010, if Pelosi, Reid, and Obama had passed a budget for FY 2011 that limited spending to FY 2004 dollar amounts, we would have had a SURPLUS in FY 2011!

In FY 2004 (October 1, 2003 – September 30, 2004), we were fighting in both Afghanistan and Iraq, and our TOTAL (on-budget + off-budget) outlays were $2.29 Trillion.

In FY 2011, revenues were $2.30 Trillion, and again we could have had a budget surplus if the 2010 Democrat House, Democrat Senate, and Democrat President had passed a budget for FY 2011 and kept spending to the same $ amounts as the Republican House, Republican Senate, and Republican President did in the FY 2004 budget.

Instead, FY 2011 actual outlays were over 57% bigger than FY 2004 outlays… an increase of $1.31 Trillion to a total of $3.60 Trillion.

And that $1.31 Trillion Democrat increase in spending meant that instead of having a $0.01 Trillion surplus in FY 2011, we had a $1.30 Trillion deficit.

The problem is NOT revenues, which went UP after the passage of the 2003 Bush Tax Cuts.

The problem is spending.

Let’s start by having a budget for FY 2013 and limiting spending amounts to what they were when Republicans controlled the House, Senate, and Presidency.

ITguy on January 8, 2013 at 9:02 PM

Again,
Had Democrats passed a budget for FY 2011 that kept outlays (spending) to the same $ totals as Bush and the Republicans had in the FY 2004 buget just sevem years earlier, there would have been a SURPLUS in FY 2011!

It’s true.

Revenues in FY 2011 were $2.30 Trillion
Outlays in FY 2004 were $2.29 Trillion

Check the numbers yourself…

Budget numbers directly from the White House Office of Management and Budget

ITguy on January 8, 2013 at 9:05 PM

The president’s insistence that Washington doesn’t have a spending problem…

…if you look up “DUMB FLUKE” in the dictionary…how long… before they just have JugEars picture?

KOOLAID2 on January 8, 2013 at 9:12 PM

There are a few instances in which not spending is a problem and actually increases the debt. How is this possible? We live in a country that defines federal trust funds as a part of the national debt rather than as holders of assets. If special taxes collected, such as FICA and gasoline, are not spent on their intended purpose, they are credited to a trust fund and thus increases the total national debt.

Let’s assumes we have reached the debt limit and Obama uses the ploy of stopping Social Security benefits while continuing to collect FICA taxes. This action of not spending taxes on the benefits they designed for would end up increasing the size of the trust and thus the debt in violation of the debt ceiling limit. Obama could exceed the limit of debt by the act of not spending.

I enjoy a good irony.

Laurence on January 9, 2013 at 5:02 AM