President Obama’s spending plan is built on the assumption that lawmakers can resolve some hugely contentious issues — and it relies on a few well-worn budget tricks.
The request he will deliver to Congress today proposes to provide what administration officials are calling a “down payment” on a major expansion of health care coverage for the uninsured. It identifies $634 billion in tax increases and spending cuts to cover the cost of part of the program, but does not say how the administration hopes to raise the rest of the money — hundreds of billions of dollars more. “TBD” has been penciled into categories for cost savings and benefit reductions.
Obama’s budget also would make permanent a tax cut for the middle class enacted in the recent stimulus package. But to pay for it, the president counts on a big infusion of cash from a politically controversial cap-and-trade system, which would force companies to buy allowances to exceed pollution limits. Even if that plan is approved, some lawmakers have other ideas about how to spend the money.
And though Obama told Congress on Tuesday that his budget team has “already identified $2 trillion in savings” to help tame record budget deficits, about half of those “savings” are actually tax increases, administration officials said. A big chunk of the rest of the savings comes from measuring Obama’s plans against an unrealistic scenario in which the Iraq war continues to suck up $170 billion a year forever.
“They’ve painted the worst-case scenario in order to make it as easy as possible to improve on,” said Maya MacGuineas, president of the bipartisan Committee for a Responsible Federal Budget, which champions deficit reduction. “This budget is more realistic than we’ve seen in the past, in that it actually includes all the policies the administration is supporting. But I’d like to see them go much further in terms of fiscal responsibility in actually closing that deficit gap.” Continue reading . . .
