President Barack Obama recently added his fiscal 2014 budget proposal to the pile of rival proposals also not likely to become law.
President Barack Obama recently added his fiscal 2014 budget proposal to the pile of rival proposals also not likely to become law.
The White House document has much to dislike: Over the next decade the president’s spending plan (a) would add an additional $5.2 trillion to federal taxpayers’ debt and (b) still wouldn’t come close to balancing in any of those 10 years.
But what’s noteworthy has less to do with numbers than with policy choices: For the first time in the five annual budgets Obama has offered, the president proposes cuts to the growth of Medicare and Social Security. That’s four years overdue from Obama, who, even before he took office, pledged to salvage unsustainable entitlement programs.
We welcome him to the serious national discussion about how to reform programs that are on paths to insolvency — and that also are the biggest drivers of total federal deficits.
Obama has acknowledged that the federal budget is on an unsustainable path. In addition to the huge annual deficits incurred since the economy collapsed late in 2008, Washington faces a long-term threat from anticipated increases in the cost of Medicare and other popular health care entitlements. But the president’s earlier budgets proposed only half-measures to address the problem. Over the past couple of years, Washington has staggered from one fiscal crisis to another.
In his new budget, Obama proposes his most significant deficit reduction steps to date, amounting to almost $1.8 trillion in savings over 10 years. They include lower caps on discretionary spending, fewer tax deductions for high-income Americans and some notable restraints on Medicare and Social Security.
Obama’s initiative represents a significant departure in policy. In the nearly eight decades since Franklin Roosevelt won the enactment of Social Security, the centerpiece of the New Deal, the five previous Democratic occupants of the Oval Office — Presidents Truman, Kennedy, Johnson, Carter and Clinton — have fought to expand its benefits or keep them intact, often against Republican opposition. Obama’s course has already drawn howls from liberals within his own party.
The question is whether Republicans are equally serious about balancing the budget. House Republicans have sought to go further and faster, eliminating the deficit within a decade. But with so many Americans out of work, policymakers have to be careful not to cut spending so aggressively that it slows the economy or curtails investments that promote growth.
Taxes will be a nettlesome issue. Obama wants a quid pro quo in the form of $580 billion in new taxes. That would include a 28-percent cap on tax deductions for couples earning more than $250,000 and individuals earning more than $200,000, along with higher tobacco taxes to finance expanded prekindergarten education and limits on tax-sheltered retirement savings. None of those will be palatable to the GOP. And frankly, we’re not too choked up about it either.
But no deal will ever be possible unless both sides are prepared to give. Obama’s offer is a starting point. We’ll see where that goes.
From The New Bern (North Carolina) Sun Journal