The Phantom Man with the Phantom Plan
posted at 9:30 pm on October 1, 2012 by Matt Vespa
Driving back home to Annapolis last night, I had the ‘pleasure’ of listening to President Obama’s campaign speech in Bowling Green, Ohio. I won’t lie – some of the stuff he said almost made me drive off the highway – but it conveyed his naiveté well. I’m about half the president’s age, but I know that raising taxes on the job creating and investing class wouldn’t get us out of the fiscal hole we’ve dug ourselves.
President Obama’s plan, and that of the Democratic Party, is to raise taxes to pay down our deficit and invest in education, which has hit a new low in confidence levels, and green energy, which is marred by Solyndra. Sadly, Mr. Romney’s inability to stay on message due to bad advice and media bias has been ineffective in combating the president’s narrative. Luckily, he has a shot to change the game in the upcoming presidential debate this Wednesday. However, Andrew Stiles of The Washington Free Beacon wrote on September 28 that we should all be mindful of Obama’s phantom deficit plan.
It centers on reducing our deficit by $4 trillion dollars over the next ten years. A plan that former President Bill Clinton spoke highly of at the Democratic Convention earlier this month. Stiles cites Glenn Kessler, who has been somewhat better in his ‘fact checking’ skills for The Washington Post as he has made:
the repeated claim that Obama’s budget reduces the deficit by $4 trillion is simply not accurate.’
‘Virtually no serious budget analyst agreed’ with the Obama administration’s accounting with respect to the $4 trillion figure, Kessler found.
Independent experts panned the president’s budget for its “troubling” reliance on gimmicks and accounting tricks to inflate the magnitude of the savings being proposed.
Keith Hennessey, a former director of the National Economic Council, estimated the true value of Obama’s deficit reduction—minus these gimmicks—to be about $2.8 trillion, and called even that reduced figure a “generous” assessment.
The president’s budget, for instance, takes credit for about $1 trillion in spending cuts that were already signed into law in 2011, and should already be incorporated given that they fall outside the 10-year budget window.
The budget also includes another $800 billion in phantom savings related to the military drawdowns in Iraq and Afghanistan—money that would never have been spent to begin with—and another $800 billion in projected savings due to reduced interest payments on the debt, something not traditionally cited in federal budget documents as a form of government ‘spending’ that can be ‘cut.’
…the idea that savings from the drawdown in Afghanistan—even if those savings were real—could ‘pay down our debt,’ as Obama suggests, is simply not credible.
Obama’s proposals, activist MacGuineas noted, would “barely stabilize the debt—and at too high a level,” much less pay it down.
Even the liberal Ezra Klein has acknowledged that ‘there’s a good case to be made that Obama’s budget doesn’t actually hit the deficit-reduction target it’s implying that it hits.’
Yes, Ezra Klein, the man who lamented about how we should have had a bigger stimulus during the Democratic Convention, said the president’s own deficit plan is a farce.
While some supporters of the president have tried to pivot and label this Simpson-Bowles 2.0 – Stiles wrote that Kessler corrected this false assumption and said that the Simpson plan “is actually quite different, calling for tough spending cuts and substantial tax reforms—not the faux proposals contained in the president’s budget.”
Furthermore, “the Office of Management and Budget (OMB)’s own figures reveal that Obama’s budget would net just $14 billion in reduced federal spending over the next decade, compared to its baseline projections, which effectively represents the status quo. Total federal spending would rise from $3.8 trillion this year to $5.8 trillion in 2022, an increase of 53 percent. The president’s extreme reluctance to rein in federal spending is captured in Bob Woodward’s latest book, The Price of Politics.”
In other words, the president can’t have a serious plan on the deficit since his own base would find it unpalatable.