Obama's Fake Budget

Is President Obama serious about the first budget he has ever presented to Congress (this should be his fourth not first budget, but he seemed to be too busy with other things to follow up on his constitutional duty to present an annual budget)? Or is he hoping to pit liberal Democrats against conservative Republicans so as to tie up Congress in yet another knot that will make him look like the "White Hat," the good guy. Take a look at what Obama is suggesting. Advocates for seniors say he is breaking his promise to protect Social Security, while conservatives say he is breaking his promise not to raise taxes on the middle class. And advocates from across the political spectrum are reminding the President of his past campaign promises. Max Richtman, head of the National Committee to Preserve Social Security and Medicare, says it will be up to Congress to set fiscal priorities. "The president's budget is not the balanced plan promised to Americans before November's election." The President's budget increases taxes by $1 trillion over the next decade. Most of the tax increases would target wealthy households and corporations, though some, including a tax increase on cigarettes and a new cost-of-living cakculation would hit low- and middle-income families, too. The far-reaching COLA proposal is Obama's plan to use what is called the chained Consumer Price Index. It would both reduce benefits and raise taxes because it calculates a lower level of inflation than the currently used Consumer Price Index. The change could have far-reaching effects because so many programs are adjusted each year based on year-to-year changes in consumer prices. Beginning in 2015, Social Security recipients, military retirees and civilian federal retirees would get smaller benefit increases each year. Taxes would gradually go up because of smaller annual adjustments to income tax brackets, the standard deduction and the personal exemption amount. Most of the COLA adjustment savings would come from Social Security. On average, the new measure would reduce annual cost-of-living adjustments, or COLAs, by 0.3 percentage points. This year, the COLA was 1.7%. Under the new measure, it would have been about 1.4%. President Obama barely mentioned Social Security in his 2012 campaign, but four years earlier, he made promises about it, and some liberal groups have been circulating the video evidence. In a 2008 speech to AARP, Obama said: "John McCain's campaign has suggested that the best answer for the growing pressures on Social Security might be to cut cost-of-living adjustments or raise the retirement age. Let me be clear: I will not do either." Now, in 2013, the President is saying, "I don't believe that all these ideas are optimal, but I'm willing to accept them as part of a compromise if and only if they contain protections for the most vulnerable Americans." His COLA proposal would exempt programs like food stamps and the President's new health care law, college tuition Pell Grant recipients and those who receive Supplemental Security Income or who have received disability benefits for 15 years. In all, the new COLA measure would reduce scheduled benefits by $130 billion over the next decade, according to administration estimates. It would raise taxes by $100 billion. The huge problem with the Obama proposal is that it would hit low-income taxpayers, who would see the biggest tax increases because much of their income is not currently subject to federal income tax. Democrat liberals in Congress say they will not support the measure. They say it is grossly unfair to penalize the poorest members of society in order to pay for deficits primarily caused by the Bush tax breaks, two unfunded wars and an economic recession as an answer to the nation's problems. But, the biggest tax increase in Obama's budget would limit the value of itemized deductions for wealthy families. The limits would apply to all itemized deductions, including those for mortgage interest that would kill the baby steps of the housing renewal now occurring, charitable contributions and state and local taxes. They would also apply to tax-exempt interest, employer-sponsored health insurance which he promised in lobbying for Obamacare, and income exclusions for employee retirement contributions that will make every American poorer. Charities oppose the limits because they are worried they would discourage wealthy people from donating. Obama has made similar proposals before and received lukewarm responses from fellow Democrats. Most Republicans oppose them. ~~~~~ So, dear readers, where are we? It looks to me like President Obama has presented a budget tailor-made to fail. Tailor-made to anger both Democrats, because it penalizes the poor and weak, and to anger Republicans because it proposes $1 trillion in new taxes over the next decade. BUT, the real flaws in the Obama budget are two : (1). It does indeed put the burden on those Americans least likely to be able to survive on reduced incomes, and (2). It ignores the basic problem - US federal entitlement programs, especially Social Security and Medicare, need a complete overhaul, not the bandaid provided by tweeking the COLA calculation. Where is the call for federal executive departments to reduce staff and justify programs, as Ronald Reagan demanded, resulting in the elimination of 700,000 federal employees? Where is the elmination of executive bureaus and agencies and tzars whose value is minimal at best? Where is the call for sending as many programs as possible back to the state level where they belong? Where is the call for a total review and revision of the US Income Tax Code and a serious effort to eliminate federal regulations and form-filling that cost business billions every year, things which would actually increase the tax base while freeing up business to expand and create sorely needed jobs? They do not exist in the Obama budget because he either does not understand what is really needed - or he does not care. As long as he can party at the White House with the likes of Justin Timberlake, send his wife and daughters to Colorado to ski while he plays golf in Florida, why should he care. Of course, he can always try to look good by giving back 5%of his salary while asking the poor and disabled to give back more. Of course, he can close the White House to the people it belongs to - the Americans who paid for it, who died to defend it, and who actually want to see it survive. But those are things Barack Obama, sadly for America, simply does not understand or identify with.