Obama’s budget for 2014 is an exercise in laziness. It is a perpetuation of the status quo. While it is certainly a step in the right direction for the Senate Democrats, who have failed to produce a budget for each of the President’s first four years in office, should we really be celebrating the fact that the President is finally meeting his constitutional obligation?
While House Budget Committee Chairman Paul Ryan dutifully led the charge to submit budgets that cut spending and aim to reduce the deficit and debt, the Democrats chose not to submit their own budget, but to simply attack Ryan’s. And budgets the White House previously produced under Obama were so absurd that for example, the Senate, with a vote of 97 to 0, unanimously rejected the 2011 version.
The media is heralding this 2014 budget as a breakthrough in entitlement reform, and frankly this analysis is laughable. It is true that the Obama budget technically includes an entitlement reform. But this reform is purely technical. The so-called “chained CPI” is merely a change in the way inflation is measured in terms of programs like Social Security. In fact, even the White House itself admits that this is only a more accurate mode of measuring inflation and thus is really not a cut at all. What is most puzzling is that Mr. Obama has made it clear that he does not approve of this “cut.” But why should a technical correction be a matter of political debate?
Perhaps most troubling is the fact that this so-called reform doesn’t solve anything. It equates to a $25 reduction of a $10,000 check. Further, the 2014 budget offers a $0.6 trillion actual deficit reduction over the next ten years, in comparison to its 2014 allocation of $46.5 trillion. Additionally, every dollar of this reduction comes from tax increases rather than spending cuts, and these increases will just be spent elsewhere rather than staying in the pockets of
hard-working Americans to go towards a down-payment on a house or tuition payments.
There is absolutely no compromise in this budget whatsoever. The Obama Administration plans to spend $160 billion more in 2014 than in 2013 and will add $128 billion to the deficit in 2014 – and Obama claims this is a budget cut!
The problem Republicans now face is how to achieve a balanced budget and maneuver entitlement reform negotiations as Democrats stomach their miniscule “cut.” Given the President’s dislike for the extremely insignificant chained CPI correction, it is inconceivable that he would agree to legitimate entitlement reform like raising the retirement age for Social Security and Medicare to match longevity. Obama seems to refuse to grapple with the issue of an aging population placing pressure on Social Security and Medicare. Shouldn’t these programs be reformed to reflect longer life expectancies and greater wealth among today’s retirees?
The best solution for such a conundrum is a Republican concession on tax revenue by creating a revenue neutral reform that cuts tax rates by closing tax loopholes, much like 1986 Reagan-Tip O’Neill tax reform. This way, real entitlement reform may be addressed, the deficit reduced and the burden of the double-digit trillion-dollar