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Obama's Most Political Budget Yet

- February 3, 2015

Obama's Budget Lays The Groundwork For His Would-Be Successor, Hillary Clinton, But Ignores The Nation's Long-Term Problems

OBAMA'S BUDGET HAS MORE TO DO WITH HIS OWN AGENDA AND THE 2016 ELECTIONS THAN ACTUALLY GOVERNING

The New York Times: Obama's Budget Is "More Utopian Vision Than Pragmatic Blueprint" And Is "Politically Improbable." "President Obama presented a budget on Monday that is more utopian vision than pragmatic blueprint. It proposes a politically improbable reshaping of the tax code and generous new social spending initiatives that would shift resources from the wealthy to the middle class." (Julie Hirschfield Davis, "In Budget, Obama's Unfettered Case For Spreading The Wealth," The New York Times , 2/2/15)

CBS News: Obama's Budget "Is The Most Methodically Political Of His Presidency" And Abandons "Any Pretense Of Pursuing A Balanced Budget-Now Or Ever." "Mr. Obama's budget, debuting Monday morning after a build-up twice as long as for Super Bowl XLIX, is the most methodically political of his presidency. The post-recession era has given Obama room to boost spending on guns and butter, propose $650 billion in new taxes, abolish the sequester, seek nearly $500 billion in infrastructure spending and abandon any pretense of pursuing a balanced budget - now or ever." (Major Garrett, "The Budget: Obama's Next Campaign…And Hillary Clinton's Warm-Up Act," CBS News, 2/2/15)

Time: Obama Is "Keeping An Eye On His Own Legacy And How It Will Affect Whoever Becomes The 45th Commander-In-Chief." "But while the focus of the coming days will be what Congressional Republicans have to say about the ideas, the real target of the budget proposal and the State of the Union is elsewhere. As Obama winds down his final term in office, he's keeping an eye on his own legacy and how it will affect whoever becomes the 45th commander-in-chief. The policy ideas unveiled in Obama's 2015 budget aren't about 2015 at all, but 2016 and the years after that." (Maya Rhodan, "The Real Audience For Obama's Latest Budget Plan," Time, 2/2/15)

Obama's Budget Is Meant To Set Up Democrats For The Next Election Instead Of Dealing With The Problems Facing The Country

CBS News Headline: "The Budget: Obama's Next Campaign…And Hillary Clinton's Warm-Up Act." (Major Garrett, "The Budget: Obama's Next Campaign…And Hillary Clinton's Warm-Up Act," CBS News, 2/2/15)

Obama's Budget Is Filled "With Liberal Priorities" As He Attempts To "Define The Democratic Party In The Run-Up To The 2016 Presidential Race." "President Obama is set to release a $4-trillion budget Monday with liberal priorities that have little chance of passage but will serve as an initial foray in negotiations with the new Republican Congress and help define the Democratic Party in the run-up to the 2016 presidential race." (Lisa Mascaro and Kathleen Hennessey, "Obama Confronts GOP With $4 Trillion Budget," Los Angeles Times, 2/2/15)

CBS News' Major Garrett: "There's A Great Deal For Clinton In This Budget" As She Has Previously Aligned Herself With Obama's Economic Policy. "But there's a great deal for Clinton in this budget. Her State of the Union Tweet was her tell. By telling the world President Obama 'pointed' the 'way to an economy that works for all' Clinton implicitly announced she would be following that path and that she would enlist others to 'step up and deliver.'" (Major Garrett, "The Budget: Obama's Next Campaign…And Hillary Clinton's Warm-Up Act," CBS News, 2/2/15)

  • Democrats Close To Clinton "Say The Obama Budget Is A Welcome Prelude To Her Eventual Campaign." "But Democrats close to Clinton's campaign-in-waiting say the Obama budget is a welcome prelude to her eventual campaign for two reasons: the month-long rollout has kept Democratic priorities at the center of the national debate and, while giving her team time to hash out the proper time to announce (the debate there, with no swift resolution in sight, comes down to the staying-above-the-fray camp versus the she-needs-time-in-the-trenches camp)." (Major Garrett, "The Budget: Obama's Next Campaign…And Hillary Clinton's Warm-Up Act," CBS News, 2/2/15)

Budget Analyst Stan Collender: "It's As Much A Budget For The Senate Democratic 2016 Campaign As It Is For Hillary." "'It's as much a budget for the Senate Democratic 2016 campaign as it is for Hillary,' said Stan Collender, long-time budget analyst and executive vice president of Qorvis MSLGroup 'Democrats have a decent shot at retaking the Senate and this is designed to help them. There's no doubt in my mind that Obama wants to help, or at least not hurt, the next Democratic presidential nominee and having a prohibitive favorite like Hillary makes it easier for him to see what will be good for her campaign. He wouldn't be able to do this if the field was wide open.'" (Major Garrett, "The Budget: Obama's Next Campaign…And Hillary Clinton's Warm-Up Act," CBS News, 2/2/15)

OBAMA BUDGET DOESN'T EVEN ATTEMPT TO DEAL WITH THE NATIONAL DEBT

The New York Times: "Absent From The Plan Is Any Pretense Of Trying To Address The Main Drivers Of The Long-Term Debt…" "Absent from the plan is any pretense of trying to address the main drivers of the long-term debt - Social Security and Medicare - a quest that has long divided both parties and ultimately proved impossible. The document instead indicates that Mr. Obama, after years of being hemmed in on his fiscal priorities because of politics and balance sheets, feels newly free to outline an ambitious set of goals that will set the terms of a debate between Democrats and Republicans and shape the 2016 presidential election." (Julie Hirschfield Davis, "In Budget, Obama's Unfettered Case For Spreading The Wealth," The New York Times , 2/2/15)

  • Obama's Budget "Does Virtually Nothing To Change The Trajectory Of Entitlement Spending By The Federal Government…" "But for all that belt-loosening, the new budget plan does virtually nothing to change the trajectory of entitlement spending by the federal government, which will devote more of its resources to the elderly over the coming decade and less to everything else." (Jonathan Weisman, "Obama's Budget: Beyond The Boldness, Nuggets With G.O.P. Appeal," The New York Times, 2/2/15)
  • Committee For A Responsible Federal Budget President Maya MacGuineas: "We're About To See A Budget That No Longer Even Aspires To Get Control Of The Debt." "'Entitlement reform - the most critical piece of fixing our fiscal situation - is the disappearing story of the upcoming budget cycle,' says Maya MacGuineas, president of the Committee for a Responsible Federal Budget. 'The debt levels are still quite scary, and yet we're about to see a budget that no longer even aspires to get control of the debt.'" (Linda Feldmann, "Budget 2016: Obama Moves Left, Testing Republicans," The Christian Science Monitor, 2/2/15)

Obama's Budget " Makes No New Effort To Fix The Swelling Costs Of Social Security And Medicare." "It makes no new effort to fix the swelling costs of Social Security and Medicare." (Nick Timiraos and Carol E. Lee, "Obama Proposes Nearly $4 Trillion Budget For Fiscal 2016," The Wall Street Journal, 2/2/15)

As The Main Drivers Of The National Debt Remain Intact, Obama's Budget Would Leave Massive Deficits Behind

Obama's Record $4 Trillion Budget Leaves Massive Deficits, Which Will Continue To Rise Over The Next Ten Years. "Obama's fiscal blueprint, for the budget year that begins Oct. 1, proposes spending $4 trillion - $3.99 trillion before rounding - and projects revenues of $3.53 trillion. That would leave a deficit of $474 billion. Obama's budget plan never reaches balance over the next decade and projects the deficit would rise to $687 billion in 2025." (Martin Crustinger, "Obama Sends Record $4 Trillion Spending Plan To Congress," The Associated Press, 2/2/15)

  • Throughout The Next Decade The Federal Government Will Accumulate $5.6 Trillion In New Deficits . "Federal coffers would see another $5.6 trillion in accumulated deficits over the coming decade, never dropping below $463 billion in a year. (It would be $474 billion in 2016)." (Steven Dennis, "Obama Budget Seeks End To 'Mindless Austerity," Roll Call, 2/2/15)
  • Obama Lays Out Another Budget With "No Effort To Eliminate The Deficit." "Like his previous budgets, Obama makes no effort to eliminate the deficit - merely keeping it below 2.5 percent of GDP." (Steven Dennis, "Obama Budget Seeks End To 'Mindless Austerity," Roll Call, 2/2/15)

"Obama Used To Speak Regularly About The Perils Of Deficits, And The Ever-Rising Federal Debt…" "Obama used to speak regularly about the perils of deficits, and the ever-rising federal debt, which is the cumulative total of annual deficits. In 2010, he appointed a panel, the Simpson-Bowles commission, to come up with proposals for tackling the nation's unsustainable fiscal path. The Budget Control Act of 2011 did bring spending down, via sequestration, but now both parties are ready to move away from that technique." (Linda Feldmann, "Budget 2016: Obama Moves Left, Testing Republicans," The Christian Science Monitor, 2/2/15)

Obama's Budget Does Little To Deal With Future Deficits That Will Be Skyrocketing Due To "Soaring Interesting Payments." "Indeed, soaring interest payments account for all of the deficit in Obama's budget by 2022. That's due to an expectation that record low interest rates will start to rise, as well as the addition of trillions in additional debt." (Steven Dennis, "Obama Budget Seeks End To 'Mindless Austerity," Roll Call, 2/2/15)

OBAMA PAINTS A "GLOOMY" PICTURE OF THE ECONOMY WHILE PUSHING HIGHER TAXES

Obama's Budget Provides "A Gloomy View Of An Economy That Is Growing Slower And Creating Fewer Rewards For Its Workers Than It Did In Much Of The Last Century." "Beneath President Barack Obama's plan to fight income inequality lies a gloomy view of an economy that is growing slower and creating fewer rewards for its workers than it did in much of the last century." (Jason Lange And Howard Schneider, "Behind Obama's Budget Proposals, A Gloomy View Of The Future," Reuters, 2/2/15)

Reuters Headline: "Behind Obama's Budget Proposals, A Gloomy View Of The Future" (Jason Lange And Howard Schneider, "Behind Obama's Budget Proposals, A Gloomy View Of The Future," Reuters, 2/2/15)

  • The Economic Vision Of Obama's Budget Is "Pessimistic" Despite Incorporating His Proposed Spending Initiatives. "The economic vision presented in the plan is all-the-more pessimistic given that it incorporates the impact of higher spending on infrastructure and education, as well as overhauls of tax and immigration laws. Many of those proposals are unlikely to pass the Republican-controlled Congress." (Jason Lange And Howard Schneider, "Behind Obama's Budget Proposals, A Gloomy View Of The Future," Reuters, 2/2/15)

Obama Is Determined "To Dig In-Rather Than Scale Back-On His Belief That The Government Should Play A Fundamental Role In Spreading Economic Prosperity Throughout The Country." The budget reflects the degree to which Mr. Obama emerged from last year's midterm congressional election losses determined to dig in - rather than scale back - on his belief that the government should play a fundamental role in spreading economic prosperity throughout the country. (Julie Hirschfield Davis, "In Budget, Obama's Unfettered Case For Spreading The Wealth," The New York Times , 2/2/15)

  • Despite Obama's Tax-And-Spending Proposals, His New Budget Expects The Economy To Be $500 Billion Smaller In 2020 Than His Administration Projected A Year Ago. "Even with these measures, which are aimed to counter rising income inequality, weaker growth would leave the economy about $500 billion smaller in 2020 than the administration projected a year ago. The administration expects the share of national income going to labor - as opposed to capital - to hold near historic lows for years to come." (Jason Lange And Howard Schneider, "Behind Obama's Budget Proposals, A Gloomy View Of The Future," Reuters, 2/2/15)

"The Administration's Take On The Economy Moves It Closer To The Growing View Among Economists That The United States Could Be Stuck In A Prolonged Period Of Stagnation." (Jason Lange And Howard Schneider, "Behind Obama's Budget Proposals, A Gloomy View Of The Future," Reuters, 2/2/15)

Obama's Proposal "Cut Forecasts For An Array Of Economic Variables, Depicting Less Growth, Weaker Inflation And Lower Interest Rates Than Officials Expected Only A Year Ago." "In a budget proposal unveiled on Monday, the White House cut forecasts for an array of economic variables, depicting less growth, weaker inflation and lower interest rates than officials expected only a year ago." (Jason Lange And Howard Schneider, "Behind Obama's Budget Proposals, A Gloomy View Of The Future," Reuters, 2/2/15)

Recently "Wage Growth Has Been Slow To Materialize" Which Is "Hampering Businesses' Ability To Raise Prices In The Wake Of 2007 To 2009 Recession…" "Despite job market improvement, wage growth has been slow to materialize. That's hampering businesses' ability to raise prices in the wake of 2007 to 2009 recession, and a drop in oil costs is also tempering inflation." (Jeanna Smialek, "Obama Budget Sees Inflation Slowing As Fed Weighs Rate Increase," Bloomberg, 2/2/15)

Obama's Solution To His "Gloomy" Outlook On The Economy Is More Taxes

Obama's Budget "Is Packed With Tax Proposals" That Raise Taxes By $958 Billion. "Mr. Obama's budget is packed with tax proposals almost certain to be ignored. Measures to raise taxes on the rich and on big financial institutions would raise $958 billion over 10 years, almost a trillion if a measure to tax the fees of hedge fund and private equity managers as ordinary income is included." (Jonathan Weisman, "Obama's Budget: Beyond The Boldness, Nuggets With G.O.P. Appeal," The New York Times, 2/2/15)

  • Obama's Proposed Higher Capital Gains Tax "Will Go Nowhere On The Hill." "The president's proposal for a higher capital gains tax, meanwhile, will go nowhere on the Hill." (Stephanie Simon, "Obama's Proposals - From Healthy To Dead-On-Arrival," Politico, 2/2/15)

"While Obama Defends His Budget As An Exercise In 'Middle-Class Economics,' A Preliminary Analysis By The Nonpartisan Tax Policy Center Found The 60 Percent Of Americans In The Middle Would Just Break Even. "While Obama defends his budget as an exercise in 'middle-class economics,' a preliminary analysis by the nonpartisan Tax Policy Center found otherwise. Forecasters at the center say while the wealthiest Americans would pay higher taxes under the president's plan, most of the benefits would go to those at the bottom of the income ladder. The 60 percent of Americans in the middle would more or less break even." (Scott Horsley, "Obama's Budget Proposal Lifts 2013 Caps, Adds Billions In Spending,"NPR, 2/2/15)


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