President Obama released his FY 2013 budget today. Like his previous budgets, it projects an annual deficit for this year in excess of $1 trillion dollars ($1.33 trillion to be precise), slimming to $901 billion in red ink next year, and eventually “shrinking” (as the AP so eloquently put it) the deficit to just under $600 billion by 2018. To put that in perspective, the largest deficit ever posted during the notoriously spendthrift Bush Administration was a comparatively frugal $482 billion in 2008 – when America was fighting two wars and Congress approved the then-unprecedented and innocuously named Troubled Asset Relief Program (the bank bailout for those of us on Main Street).
Yet the true cost of President Obama’s budget, as irresponsible as it is, is even larger than first meets the eye. It relies on “savings” that will purportedly be achieved as a result of the end of American combat operations in the Middle East. But are these real savings?
The military has also ceased its active prosecution of wars in Vietnam and Korea. American G.I.’s are no longer landing on Normandy Beach. Blackjack Pershing isn’t leading Doughboys across the trenches of World War I Europe. And Teddy Roosevelt’s charge up San Juan Hill has long since passed. So does that mean we can we expect the creative bean counters in the White House Office of Management and Budget to also tabulate and reprogram these phantom peace dividends to cover the anticipated costs of Obamacare or to fund the rarely seen but oft-cited shovel-ready project?
Worse than this cynical Beltway-style Arthur Andersen accounting, however, is the utter lack of even a modest attempt at tackling America’s ballooning entitlement crisis. The White House isn’t just fiddling while our public finances lurch toward a Wile E. Coyote-like cliff. Indeed, President Obama seeks to step on the accelerator.
Entitlement spending – that is expenditures on things like welfare programs, Social Security, Medicare, and interest on the debt – is rapidly approaching two thirds of all federal spending. And the addition of programs like Obamacare and the Bush-era Medicare Part D prescription drug benefit will only continue to exacerbate the problem.
Unlike highway or defense programs, the runaway costs of these entitlement programs are driven by the number of people who sign up for them, making them increasingly difficult to control once politicians have created them. Worse still, they are notoriously tough to reform once they are created because politicians fear the collective voting power of program beneficiaries. A politician who takes money from Peter and gives it to Paul, as the old saying goes, can always count on the vote of Paul.
Unfortunately for the American taxpayer – each of whom now personally owes nearly $140,000 on the national debt – President Obama and the left appear content to rely on growing the number of “Pauls” to boost their electoral chances rather than pursuing pro-growth policies that will convert more Pauls into Peters. And while this may be a sound short term electoral strategy, it is a disastrous long term economic policy. One need only look to Greece for a sneak peek at where these wrong-headed redistributionist policies and bloated public sector spending ultimately leads. The Europeans are fast learning that even enduring, socialist-leaning parliamentary majorities cannot repeal the laws of basic economics.
The leader of the reformation Martin Luther, once wisely noted, “How soon ‘not now’, becomes never.” Congress should heed the warning, stop procrastinating, reject President Obama’s budget, and take up Wisconsin Representative Paul Ryan’s budget blueprint as a starting point for getting America back on a sustainable fiscal path. Or ‘never’ will soon become ‘now.’