WASHINGTON -- President Barack Obama insists he wants a balance of more taxes and less spending to curb runaway budget deficits. His record suggests, however, that he leans against cutting spending.
After federal spending soared during the Great Recession that straddled the end of the Bush presidency and the start of his own, Obama has never proposed cutting spending back to pre-recession levels. He never fully embraced his own deficit reduction panel’s call for a 10-year package of $4 trillion in spending cuts and tax hikes. He agreed to some spending cuts in 2011 only after Republicans took the House of Representatives and threatened to turn off the government’s credit if he didn’t go along. And he’s fighting now to replace $1.2 trillion in spending cuts over 10 years with fewer cuts and new tax increases.
The White House has tantalized budget cutters – and angered liberal Democrats – by expressing interest in cost-savings proposals such as a new method to calculate Social Security benefits that would save money in one of the biggest parts of the budget.
“That was a big step and I believe his economic team cares about this issue, but I don’t see a strategy for making sure it happens,” said Maya MacGuineas, president of the nonpartisan Committee for a Responsible Federal Budget.
“The truth is he’s never put forth a budget big enough to fix the problem,” she said of the deficits and rising debt. “He’s talked about it, but never fully where we need to go. He needs to be the closer in this.”
White House advisers bristle at suggestions that Obama isn’t as committed to chipping away at the federal deficit as any fiscal hawk, with Obama claiming in his State of the Union address that he and Congress had delivered $2.5 trillion in deficit reduction measures, including trimming spending. The number, however, is misleading, as it’s based on a budget high-water mark.
Many economists warn that the U.S. needs a mix of spending cuts and new tax revenue if it wants to put a dent in the government’s $16.5 trillion debt, stabilize Medicare and Social Security, and finance new highways, schools and defense.
But the White House says that in the case of the pending budget cuts – known as a sequester in Washington-speak – it believes the cuts are too indiscriminate and too steep to not knock off kilter a still recovering economy. It says Obama backs closing the deficit with more spending cuts than revenue, and this week it released a list of spending cuts that include reduced payments to drug companies and cutting back farm subsidies.
“The president has never said that we should close our deficit through revenue increases alone,” said White House Press Secretary Jay Carney. “And that’s what he’s pursued.”
The condition of the economy when Obama took office in 2009 makes it tricky to render a historical verdict on his appetite for budget cuts, said Robert Bixby, executive director of the Concord Coalition, a nonpartisan budget-watchdog group.
Though Republicans consider Obama’s stimulus spending a failure, Bixby and others contend few economists would have prescribed cutting government spending at the height of the recession.
And Bixby notes Obama did sign the 2011 Budget Control Act, which spawned not only the sequester – the spending cuts Obama now is looking to avert – but also imposed budgetary caps on discretionary spending. Those caps, which Bixby says “will come to bite somewhere down the road,” are poised to shrivel spending for the 40 percent of the budget that is spent on non-entitlement programs, including defense, education, research and development, law enforcement, Congress and the White House.