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Millions, Billions, Trillions
May 07, 2009 1:17 PM
ABC News' Jake Tapper and Sunlen Miller report:
In formally introducing his $3.55 trillion budget to Congress today, President Obama emphasized $17 billion in spending cuts.
"Now, some of the cuts we're putting forward today are more painful than others," the president said. "Some are larger than others. In fact, a few of the programs we eliminate will produce less than a million dollars in savings. And in Washington, I guess that's considered trivial. Outside of Washington, that's still considered a lot of money. But these savings, large and small, add up."
President Obama said "the 121 budget cuts we are announcing today will save taxpayers nearly $17 billion next year alone. And even by Washington standards, that should be considered real money."
And the president added: “It is important, though, for all of you as you’re writing up these stories to recognize that $17 billion taken out of our discretionary non-defense budget, as well as portions of our defense budget, are significant — they mean something.”
$17 billion is without question real money, and it means something, though within the context of the president's budget it's less than one half of one percent of the total budget.
And it's about 1.4 percent of the projected deficit for 2010 of $1.17 trillion.
And as the Wall Street Journal points out, the president's proposed "cuts are outweighed by proposals to spend more on an array of programs and regulatory functions." The budget for the Federal Railway Administration budget is increased, for instance, from $1.8 billion to $2.7 billion.
Whether or not $17 billion is a lot of money in spending cuts depends, of course, on what one compares it to -- and who's doing the comparing.
During the campaign last year, then-Sen. Obama discussed how Sen. John McCain, R-Ariz, railed against earmarks, and pointed out that the $18 billion in savings from eliminating earmarks paled in comparison to the $300 billion in tax breaks McCain proposed.
“Now, Senator McCain talks a lot about earmarks," Mr. Obama said during the third presidential debate in Hempstead, NY. "That's one of the centerpieces of his campaign. Earmarks account for 0.5 percent of the total federal budget. There's no doubt that the system needs reform and there are a lot of screwy things that we end up spending money on, and they need to be eliminated. But it's not going to solve the problem.”
It was a frequent Obama talking point, that $18 billion -- while not to be sneezed at -- is a trifle comparatively to the proposed McCain tax cuts, and to the budget in general.
“Earmarks account for $18 billion in last year's budget," Mr. Obama said on Fox News Sunday on September 28, 2008. "Senator McCain is proposing $300 billion in tax cuts. Now, $18 billion is important. $300 billion is really important.”
"The total amount of earmarks even broadly defined comes to about $18 billion," Mr. Obama said on the campaign trail in June in Wayne, Pennsylvania. "Now, I’m not a math whiz, but if you’re giving $300 billion in tax breaks, and lets say you eliminated all earmarks ... even assuming all $18 billion is delivered, you’ve still got to, let’s see my math, $282 billion short and he hasn’t specified where else he’d get the money. And what’s likely is that he’d get the money the same way that George Bush got the money, which is to take out a credit card from the bank of China in the name of our kids and add a few extra trillion dollars extra worth of national debt.”
President Obama is not proposing $300 billion in corporate tax breaks, of course. But he is proposing a $3.55 trillion budget, with significant increases in many spending programs.
It may be difficult for the GOP to hit the president on this issue, however.
As Chris Edwards of the libertarian CATO Institute points told ABC News, "I don't think the Republican party has any credibility on spending restraint anymore. Deficits soared hundreds of billions of dollars under President Bush, so President Obama is really continuing fiscal irresponsibility."
President Bush racked up almost $5 trillion in national debt during his two terms.
Interestingly, one of the 121 cuts the White House is touting today is the “Los Alamos Neutron Science Center Refurbishment.”
Says the White House: "The programs in Terminations, Reductions, and Savings are ones that do not accomplish the goals set for them, do not do so efficiently, or do a job already done by another initiative. They include: ... Los Alamos Neutron Science Center refurbishment ($19 million). The linear accelerator housed here was built 30 years ago and no longer plays a critical role in weapons research.”
The president actually signed a bill giving $19 million to that very same program when he, behind closed doors, signed the omnibus spending bill in March that contained roughly $8 billion in earmarks, as Sen. Jeff Bingamin, D-NM, heralded in a press release.
“U.S. Senator Jeff Bingaman today reported that President Obama has signed a spending bill that contains funding for important northern New Mexico initiatives," read a Bingamin press release from March 2009. "Bingaman worked to set aside funding for northern New Mexico projects. They include: ... $19.3 million for rebuilding the Los Alamos Neutron Science Center accelerator so the lab can use it to diversify into new science missions.”
-- Jake Tapper and Sunlen Miller
May 7, 2009 | Permalink | Share | User Comments (77)
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"Is that like Obama saying he will not raise the taxes on 95% of Americans/Americans making less than 250K?"
He was talking about income taxes. Obama certainly doesn't have direct control over the whole array of taxes we all pay.
Posted by: Skip | May 8, 2009 9:00:48 AM
"I understand Republicans have very little credibility, but you should at least try to make the lies credible."
-------------------------------------
jhw539 ,
Is that like Obama saying he will not raise the taxes on 95% of Americans/Americans making less than 250K? Then performing the insane concept of raising taxes on ALL cigarette smokers in the US regardless of income to pay for SCHIP.
So Obama LIED about raising taxes on people under 250K.
We want people to smoke less for the obvious heath reasons and we have severely limited where people are allowed to smoke, YET we turnaround and WANT them to smoke in order to fund child healthcare! Somehow liberals think this kind of @ssbackward logic is a good thing and the way we should run things from now on.
Posted by: Mike_C | May 8, 2009 8:31:25 AM
Bozo will leave as his legacy the same financial irresponsibilty that guided him through life until America's useful idiots swramed all over "his" (writtten by Bill Ayers) wonderful book and he got in the sack with Tony Rezko. Bozo and superhero-greenethumb-first mom meeeshall continuously spent way beyond their means and we're in debt up to their eyeballs until "THE BOOK", and Rezko. Sadly, we folks who will pay for his lunacy don't have any Rezkos around
Posted by: hughglass | May 8, 2009 5:40:02 AM
"As a percentage of GDP the debt thus rose from 5.55% to 5.75%. (I have not computed his second year--his only remaining one with a Democratic congress--but I've already disproved your assertion.)"
OK, you got me by +.2% so my assertion is disproved, however I also object to your implied assertion that revenues increased by cutting capital gains tax rates alone, ignoring the tech bubble.
Posted by: Skip | May 8, 2009 12:10:09 AM
By the way, the facility Obama is going to gut produces medical radioisotopes. I guess under his health care plan, we won't have to worry about that because we'll all die waiting for tests.
Posted by: Dale Evansd | May 8, 2009 12:07:59 AM
Well we might finally all agree whether Republican or Democrat, THEIR STEALING OUR money and they got us bickering at each other when it's a game to those in POWER. 535 people destroying 320 millions peoples lives. When in the hell are ya'l going to wake up and VOTE THEM ALL OUT??????? It's not Republican & Democrat, it's 535 against 320 million. Whose the stupid ones hey????? Those folks been in their 30 years playing a game and it's you idiots arguing class warfare just like they want you to while their fleecing our pockets. Wake up and VOTE THEM ALL OUT. THat's the new Tea Party anthem, VOTE THEM OUT!!!!!!!!!!
Posted by: Bob | May 8, 2009 12:07:21 AM
Bingaman got the shaft, huh? Well, I guess he won't be able to use that as an example of how he's helping New Mexico.
Posted by: Dale Evans | May 8, 2009 12:04:34 AM
For those Dems that want to lay blame on Bush for the current financial problems, I hope that you understand that the Congress votes on the budget and authorizes spending.
News flash: Congress has been controlled by Dems for the past two years.
Posted by: AmericanPatriot | May 7, 2009 11:46:45 PM
"...Clinton lowered the debt every year..."
He absolutely did no such thing. He reduced the deficit each year, but not the debt, either absolutely or as a percentage of GDP. The day he took office the debt was $4.188 trillion; one year later it was $4.515 trillion. The GDP in that period went from $7.532 trillion to $7.835 trillion. As a percentage of GDP the debt thus rose from 5.55% to 5.75%. (I have not computed his second year--his only remaining one with a Democratic congress--but I've already disproved your assertion.)
He did not run a budget surplus until the GOP had been in control of congress for three years. But the national debt on the day he left office was $5.727 trillion, or 57.3% of the GDP of $9.980 trillion. As I say, Clinton and the GOP congress deserve credit. Bush and the GOP/Democratic congresses deserve none. But Obama and the Democrats deserve very severe criticism, much more than they have yet received.
Posted by: Fascist Hyena | May 7, 2009 11:14:02 PM
"In his final three years (with a GOP congress) he reduced the national debt by $362B, for which he is to be commended."
Numbers can be chosen to make a point and if you want to find credit for Republicans you would pick measuring the debt in straight dollar amounts. Expressed as percentage of GDP however Clinton lowered the debt every year with or without the Republicans.
Posted by: Skip | May 7, 2009 10:36:58 PM
News Flash: Scientists Discover Money Actually DOES Grow on Trees. Bailouts and the Fed were a nice proxy, but this new finding changes everything.
Posted by: wendy | May 7, 2009 9:53:25 PM
" President Clinton cleaned up the last astronomical budget mess the Republicans made and now president Obama is cleaning up a worse Republican mess."
Might as well look at some actual numbers and see how that statement measures up. Bush I's final budget deficit was $290 billion; Obama's silly "stimulus" package alone is 2 1/2 times that amount.
In his first two years in office, with a Democratic congress, Mr. Clinton incurred deficits of $255B and $203B. A total of $751B was added to the national debt in his first five years. In his final three years (with a GOP congress) he reduced the national debt by $362B, for which he is to be commended. Bear in mind that he greatly incresed revenues from capital gains taxes by reducing the cap gains rate (which Obama proposes to restore), he "ended welfare as we know it"; Obama is effectively restoring it; and he enacted NAFTA. In all three of these initiatives he had far more GOP support than Democratic, but nevertheless he deserves a great deal of credit for them and I for one grant it to him.
The deficit "mess" inherited by Clinton is absolutely trivial compared to the one that Obama is very deliberatedly creating. His own OMB Director says that his spending proposals simply cannot be sustained.
Posted by: Fascist Hyena | May 7, 2009 9:06:07 PM
Obama has, in 100 days STUCK US with a multi trillion debt. And he is talking about saving 17 BILLION? Talk about a flea on an elephant's butt!!
Posted by: Jimbo | May 7, 2009 8:44:11 PM
The wealthy folks who are involved with businesses have something most of us don't have. That is, the ability to leave the US for another country that has a much more friendlier business climate. Obama wants to tax income made in foreign countries - fine, let's just move our ENTIRE business outa here. This will back fire on Obama. Don't believe me? Stick round.
Posted by: Jimbo | May 7, 2009 8:37:18 PM
"Mr. Obama deserves praise for his brilliance in being able to save 17 billion dollars by next year."
He's "saving" it from his own budget. That's brilliant, allright.
Posted by: Fascist Hyena | May 7, 2009 8:36:27 PM
people in the know are purchasing assets immune from the pending hyperinflation and devaluation of the dollar. Since Obama has crated an utter disaster with more debt, entitlements and interest payments will consume 80% of the federal budget in 10 years. How is that going to work? IT ISN"T, and the depression he is going to cause will be like something never seen before. Obama needs to be reined in before the damage he does is non-repairable.
Posted by: brian | May 7, 2009 8:29:16 PM
Obama is absolutely wrong. You cannot solve a problem of too much debt by adding more debt. He is reckless and doing extreme damage to the country. I see people complaining about Bush's spending and then giving Obama a pass even though his deficits are 4 times larger. Incredible logic.
Posted by: brian | May 7, 2009 8:19:56 PM
President Obama inherited a deficit from the Republicans in the trillions of dollars on top of an economy on the verge of total collapse and two wars. President Clinton cleaned up the last astronomical budget mess the Republicans made and now president Obama is cleaning up a worse Republican mess. The fact is that given the crisis the American economy is in Mr. Obama deserves praise for his brilliance in being able to save 17 billion dollars by next year. The Republicans never worry about money as long as it is going to the wealthy. They defended the spending of both Regan and Bush why the indignation now?
Posted by: V. Brame | May 7, 2009 8:02:00 PM
$17 billion cuts vs $75 billion that might be needed for banks , just doesn't make a lot of money sense. By the way I am not a right wing conservation or anti President Obama just livid about the actions of Congress.
Posted by: William | May 7, 2009 7:44:00 PM
Of course the GOP wants to trash the government. They are so hypocritical. Ten trillion of the present debt came under the GOP--Reagan and two Bushes. Then they left a depression. And the government can't tackle any of the GOP favorite boondoggles, huge subsides to rich farmers, massive tax breaks to oil companies, groups who have gotten tax credits for overseas facilities and are now hiding money in places like the Cayman Island.
Don't trust the GOP. They are the rich people's friends, the ones who stole your jobs, health care, retirement and homes so that their rich friends could get richer . . . and richer . . . and richer.
Posted by: JAB | May 7, 2009 7:28:59 PM
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