http://online.wsj.com/article/SB123569611695588763.html
In the closing weeks of last year's election campaign, we wrote that Democrats had in mind the most sweeping expansion of government in decades. Liberals clucked, but it turns out even we've been outbid. With yesterday's fiscal 2010 budget proposal, President Obama is attempting not merely to expand the role of the federal government but to put it in such a dominant position that its power can never be rolled back.
The first point to understand is the sheer magnitude of federal spending built into this proposal. federal outlays will soar in fiscal 2009 to $4 trillion, or 27.7% of GDP, from $3 trillion or 21% of GDP in 2008, and 20% in 2007. This is higher as a share of the economy than any year since 1945, when the country was still mobilized for World War II. It is more spending by far than during the Vietnam War, or during the recessions of 1974-75 or 1981-82.
But let's assume, for the sake of argument, that Mr. Obama is right that this spending is needed now to "jump-start" an economic recovery. Though the budget predicts that the economy will recover in 2010, spending will still be 24.1% of GDP that year, and the budget proposes that spending will remain higher than 22% for the entire next decade even as the defense budget steadily declines. All Presidential budgets predict spending will decline in the "out years," if only to give the illusion of spending restraint. Mr. Obama tries the same trick, but he is proposing so many new and expanded nondefense programs that his budgeteers can't get anywhere close even to Jimmy Carter spending levels.
The biggest illusion in this budget may be its optimistic economic forecast. The White House assumes that the economy will decline by only 1.2% this year, before growing by 3.2% next year. This assumes the recovery will begin later this year and gather steam quickly to return to normal levels of growth. By 2010 to 2013, the budget adds, the economy will be cooking by an average of 4% a year -- which is also how it conjures up magical deficit reduction.
This growth is a lovely thought, but how? The only impetus for growth in this budget comes from the government spending more money that it is taking out of the job-producing private economy. With $1 trillion of new entitlements, $1.4 trillion in new taxes, and $5 trillion in new debt, America's entrepreneurs aren't getting any help soon from Washington.
Democrats will want to rush all of this into law this year while Mr. Obama retains his honeymoon aura and they can blame the recession on George W. Bush. But Americans are only beginning to understand the magnitude of Mr. Obama's ambitions, and how much of their own income will be required to fulfill them. Republicans have an obligation to insist on a long and considerable debate on all of this, lest Americans discover in a year or two that they live in a very different country.
Originally posted by KazetNagorraNo worries mate. We will not only have spending that is (cough) meaningful, we will also soon have taxes that will be meaningful as well. 😉
The increase in government spending in itself is not such an issue, but the spending must be meaningful, and taxes need to be raised. Obama really needs to raise taxes significantly or government budget deficits will run out of hand.
Originally posted by generalissimoI know the amount being spent is quite large, but what is the alternative? 4 more years like the last 8?? I'm sorry to bring up Mr. Bush here, but like it or not, "W" took over a nation in much better economic shape than he left it in. Sometimes extreme steps are needed in extreme times. Perhaps some re thinking of supply side (support only the rich) economics would be in order here. President Obama does not have the perfect solution...just a better one.😏
http://online.wsj.com/article/SB123569611695588763.html
In the closing weeks of last year's election campaign, we wrote that Democrats had in mind the most sweeping expansion of government in decades. Liberals clucked, but it turns out even we've been outbid. With yesterday's fiscal 2010 budget proposal, President Obama is attempting not merely to e ericans [b]discover in a year or two that they live in a very different country.[/b]
Originally posted by bill718Exactly!! Both parties seem to have been hell bent on the going down pretty much the same road.
I know the amount being spent is quite large, but what is the alternative? 4 more years like the last 8?? I'm sorry to bring up Mr. Bush here, but like it or not, "W" took over a nation in much better economic shape than he left it in. Sometimes extreme steps are needed in extreme times. Perhaps some re thinking of supply side (support only the rich) economi ...[text shortened]... d be in order here. President Obama does not have the perfect solution...just a better one.😏
The Obama revolution consists of just doing a LOT MORE of the same old crap. More spending, more fighting (Afghanistan) more dept, which will lead to more problems. Just when you thought things couldn't get any worse the next group of politicians show up and suck worse then the last. Regan=Bush=Clinton=Bush=Obama.....Each worse then the last.
Originally posted by KazetNagorraThe taxation needs to be progressive (which it is) -- most people get a tax cut, whereas the Bush tax cuts get reversed on the very rich. Taxing the rich has little impact on growth, whereas taxing low to middle income earners affects growth more significantly.
The increase in government spending in itself is not such an issue, but the spending must be meaningful, and taxes need to be raised. Obama really needs to raise taxes significantly or government budget deficits will run out of hand.
Originally posted by KazetNagorraEventually Obama will have to realize that the US cannot keep spending more money on the military than all the rest of the countries of the world combined. Nor is his ultimate vision of a more compassionate, more equalitarian society compatible with foreign military adventurism. Reducing our military budget to the per capita level of other industrialized nations like Germany would go a long way to reducing and/or eliminating the budget deficit.
The increase in government spending in itself is not such an issue, but the spending must be meaningful, and taxes need to be raised. Obama really needs to raise taxes significantly or government budget deficits will run out of hand.
Originally posted by no1marauderreducing the spending on the military would weaken the US.
Eventually Obama will have to realize that the US cannot keep spending more money on the military than all the rest of the countries of the world combined. Nor is his ultimate vision of a more compassionate, more equalitarian society compatible with foreign military adventurism. Reducing our military budget to the per capita level of other industrialized nations like Germany would go a long way to reducing and/or eliminating the budget deficit.
It is already hard to fight in Iraq, afghanistan, or the fight the war on terror, and you'll only make it harder.