Breaking: White House threatens veto of Cut, Cap, and Balance bill

With the House poised to vote on a debt-ceiling increase tomorrow, the White House has released a threat to veto the bill if it reaches the President’s desk.  This statement was just released by e-mail, emphasis in the original:

The Administration strongly opposes H.R. 2560, the “Cut, Cap and Balance Act of 2011.”  Neither setting arbitrary spending levels nor amending the Constitution is necessary to restore fiscal responsibility.  Increasing the Federal debt limit, which is needed to avoid a Federal government default on its obligations and a severe blow to the economy, should not be conditioned on taking these actions.  Instead of pursuing an empty political statement and unrealistic policy goals, it is necessary to move beyond politics as usual and find bipartisan common ground.

The bill would undercut the Federal Government’s ability to meet its core commitments to seniors, middle-class families and the most vulnerable, while reducing our ability to invest in our future.  H. R. 2560 would set unrealistic spending caps that could result in significant cuts to education, research and development, and other programs critical to growing our economy and winning the future.  It could also lead to severe cuts in Medicare and Social Security, which are growing to accommodate the retirement of the baby boomers, and put at risk the retirement security for tens of millions of Americans.

Furthermore, H. R. 2560 could require even deeper cuts, since it conditions an increase in the Federal debt limit on Congressional passage of a Balanced Budget Amendment.  H. R. 2560 sets out a false and unacceptable choice between the Federal Government defaulting on its obligations now or, alternatively, passing a Balanced Budget Amendment that, in the years ahead, will likely leave the Nation unable to meet its core commitment of ensuring dignity in retirement.

The President has proposed a comprehensive and balanced framework that ensures we live within our means and reduces the deficit by $4 trillion, while supporting economic growth and long-term job creation, protecting critical investments, and meeting the commitments made to provide economic security to Americans no matter their circumstances.  H.R. 2560 is inconsistent with this responsible framework to restore fiscal responsibility and is not an appropriate method of reducing the Nation’s deficits and debt.  The Administration is committed to working with the Congress on a bipartisan basis to achieve real solutions.

If the President were presented this bill for signature, he would veto it.

A few points seem remarkable here.  Is it really Barack Obama’s contention that a balanced budget, now or in the future, threatens the dignity of retirees?  What basis does he have for claiming that deficits are a necessary component of retiree dignity?  That sounds very much like a demand for eternal deficit spending, with no attempt at any discipline whatsoever.

As far as Obama’s “comprehensive and balanced framework,” CNS News reminds us that the only specific plan Obama has published actually increases deficit spending rather than decrease it:

While the Republican-controlled House of Representatives has voted this year to approve House Budget Chairman Paul Ryan’s (R.-Wis.) proposal–that would put the government on a gradual path to a surplus by 2040–and plans to vote on a balanced budget amendment next week that would cap federal spending at 18 percent of GDP, the only budget proposal President Obama’s has publicly revealed in 2011 would, according to the Congressional Budget Office, increase the deficit by $26 billion this year, $83 billion next year, and $2.7 trillion over the next decade.

Additionally, although annual budget deficits would decline somewhat between 2013 and 2015 under Obama’s proposal, according to the CBO, after that they would start increasing again, going up every year from 2016 to 2021, the last year estimated by the CBO.

In short, the only budget proposal Obama has put forward this year for the public to review and analyze puts the federal government on a path to eventual bankruptcy.

The CBO report from April can be found here.  This chart shows that Obama’s projected budget produces bigger deficits by percentage of GDP than anything seen since 1981 — with the exceptions of the Democratic budgets to 2008-11.  They’re worse than the baseline we’re on at the moment, and not coincidentally, they make the debt load appreciably worse as a result:

If the CCB bill gets through the House and the Senate, would Obama really veto it?  He’d have to defy a Senate controlled by his own party to cancel a debt-limit increase in a situation that his own administration has relentlessly hyped as a fiscal Armageddon.  I’d call that a real long shot.

Call his bluff, GOP.