On April 29, 2009 Congress passed the Federal budget as submitted by President Obama. This was the last time that Congress passed a budget. So far for the fiscal years 2010, 2011, 2012, and now 2013, the Federal budget has been dead upon arrival in Congress – especially now in an election year. Each new budget contains elements that the President hopes that the Congress will pass. In 2013, Mr. Obama has called for more changes to the already complex tax code that would require households earning more than $1 million dollars a year to pay at least 30% of their income in Federal taxes. The president’s plan would push this year’s deficit above current projections with the budget gap growing to $1.33 trillion dollars.
Since Congress continues to operate without a formal passed budget, we have entered an era of “continuing resolutions” to keep funding the government on a temporary basis. What is disturbing is that the proposed budgets all contain large deficits where government spending exceeds incoming projected revenue. And as a result, the National debt clock continues to spiral out of control. As of noon on Saturday, February 11, 2012, our National Debt stood at $15,340,530,796,899 trillion dollars. The staggering interest on this debt is growing at an astronomical rate with interest for fiscal 2012 projected to be at $676,023,239,603.56 billion dollars!
My personal opinion is that the politicians in Washington continue to perpetuate the “status quo.” Any proposed budget will be inherently out of balance until either tax revenue is drastically increased and/or mandatory spending on such programs as Social Security, Medicare, and Medicaid is lowered. This being an election year, Mr. Obama chose to take the easy way out and propose a budget that is a mirror-image of the last few years with another large deficit of over a trillion dollars. The budget is meaningless. Under Mr. Obama’s proposal, millionaires would pay a minimum of 30% effective tax rate. Revenue generated from this tax has yet to be officially calculated, but White house estimates are in the range of $40 billion dollars up to $50 billion dollars a year. So even if we use the $50 billion dollar estimate how does this compare to a budget deficit of $1.33 trillion dollars? It does not even qualify as decent “smoke and mirrors.”
To make matters worse, the proposed 2013 budget does not factor in the costs of Obama Care. The plan is a result of blatantly dishonest accounting for the real costs of the program, while grossly overstating its benefits. Americans should know the actual 10 year cost of Obama Care is closer to $2 trillion over 10 years, not the $950 billion dollars claimed. How can there be such a gap? Mainly because the president’s plan doesn’t provide benefits until the second half of the first decade. Once these program provisions kick in, the full 10 year cost of benefits will be included at a real cost of $2 trillion dollars or more! Charles Krauthammer, a trained physician, told Fox Network’s Bill O’Reilly, “it is a trick. The way the Democrats got under the spending limit imposed by Obama was by making 98% of the expenditures, the benefits that Americans would receive under the bill occur in the second half of the decade.”
So back to the question of why submit a budget at all – especially one that has so many misassumptions in it? Maybe our Congress men and women have difficulty with the massive numbers and can’t face the reality of the situation? Possibly without a real budget, there is no way that they can get their hands around the numbers? When the Patient Protection and Affordable Care Act (Obama Care) was first proposed, it had a revenue projection of $409.2 billion dollars. When the Congressional Budget Office then estimated the Federal government’s share of the cost for the first 10 years, it came in at $940 billion dollars. Bells and alarms should have gone off.
I watched a TV program on the situation in Greece recently and the people were demonstrating in the streets. The news commentator gave a very good analysis of the situation. These people will be the recipients of the massive cuts in spending that the Greek parliament is now considering. They worked hard in anticipation of retiring under a different system. It is too late for them to make any other plans. They were not the people that were the beneficiaries of the out of control spending that occurred within the Greek government for the past decades. But they will now bear the brunt of the massive cuts.
We had better starting pay attention to our debt situation and budget accordingly or America will be Greece in a few short years. About 50 million people collect Social Security in the United States right now. Approximately 46 million people qualify for the Food Stamp Program. About 5 million people in the U.S. today collect a welfare check. In addition, we have 2.2 military retirees who collect a pension. How would you like to be the President that has to tell these 100 million people that they can no longer expect to receive the benefits they earned as a result of the fiscal irresponsibility of the United States government?