Courtesy Greenbaby President Barack Obama unveiled a multi-trillion-dollar spending plan Thursday that would boost taxes on the wealthy, curtail Medicare, lay the groundwork for universal health care and leave a string of deficits dwarfing any in the nation’s history.
In addition to sending Congress his $3.55 trillion budget plan for 2010, Obama proposed more immediate changes that would push spending to $3.94 trillion in the current year.
That would result in a record deficit Obama projects will hit $1.75 trillion, reflecting the massive spending being undertaken to battle a severe recession and the worst financial crisis in seven decades.
But Republicans contended Obama was avoiding hard choices in favor of exploding the deficit and raising taxes.
Christina Romer, head of the president’s Council of Economic Advisers, defended the administration forecast, telling reporters at a briefing that the private forecasters may not be taking into account all of the efforts the government is employing to jump-start the economy.
The Medicare plan is sure to incite battles with doctors, hospitals, health insurance companies and drug manufacturers.
The $1.75 trillion deficit projected for this year would represent 12.3 percent of the gross domestic product, double the previous post-war record of 6 percent in 1983, when Ronald Reagan was president, and the highest level since the deficit totaled 21.5 percent of GDP in 1945, at the end of World War II.
In for a penny, in for a pound. Where’s my bailout?
No news here. It is well documented for months that the only to get ourselves out of the Bush regime abyss and downward spiral is to (1)resolve the credit flow issue and (2) people back to work.
You put people back to work by consumption. Yes, ironically, consumption is now the issue. Let me help out the republicans here (no charge)
Read slowly (and don’t do anything else)
No consume = no production = no work = unemployment.
Consume = production = work – employment
How to prime the pump on Consume?
Well, Government = spend = consumer = deficit
Sounds like a plan.
Yeah so what? Every President since Nixon has spent the most money, or raised the most taxes, or has the highest deficit for their time in office.
With inflation always raising the prices on nearly everything, U.S. population growing, minimum wage rising, insurance companies gouging customers, government spending will always go up.
Sure Obama could have cut out a lot of earmarks on this bill, but how much would have have saved? It would still be in the trillions and likely still be the most expensive budget plan of all time.
The 45th president (the next one after Obama) will almost certainly sign in a new bill that’s even more costly than what Obama signed.
This is status quo.
I don’t think it matters who is in the White House or Congress for that matter. They all seem to find ways to overspend and create debt.
One thing is for certain that in fours years we will not be praising our government for all its spending.
No big deal, huh?
“The $1.75 trillion deficit projected for this year would represent 12.3 percent of the gross domestic product, double the previous post-war record of 6 percent in 1983, when Ronald Reagan was president, and the highest level since the deficit totaled 21.5 percent of GDP in 1945, at the end of World War II. ”
And you thought wars were expensive. Right. We’ll see if this “primes the pump” or not. I sincerely doubt many seniors will be happy with the Medicare cuts.
How did Obama so quickly spend Bush’s surplus?
Imagine it’s your job to spend 1 trillion dollars, at a rate of 1 million per day. You wouldn’t finish spending it for another 70 years, if you started on Christmas.
The first Christmas. With Jesus.
A trillion dollars is not just “a lot of money,” and this isn’t just nudging the deficit up another notch. The deficit will rise by orders of magnitude above anywhere it’s ever been.
China is already balking at taking on more of our debt. If they say, “no thanks,” guess what? We print it. Inflationary cycles begin. Inflation acts like a tax that hurts the poor more than the rich. Once it starts, no economist can predict where it will end. The system will force itself to equilibrium no matter what we do. We can only make the inevitable correction worse.
We’re in a runaway train headed straight for a cliff. Unfortunately, I think the momentum is too great for us to stop it now, even though we can see the cliff ahead. And we can’t jump off this train. There’s nowhere to go.
Another reason to spend and print $ like a drunk sailor;
The resulting inflation pushes people into higher tax brackets. The gov get a higher & higher % of real earnings. Greatest scam of them all…
#7, That’s absolutely correct. Tax cuts, my foot.
# 9 orangetiki said, “You have to spend money to make money.”
That can be fairly innocuous IF; A) You only spend what you have, and B) You don’t take it from the citizens pocket 1st.
Otherwise, it is harmful.
I’ve going to start paying my people in gold legal tender.
http://tinyurl.com/cdvvlg
So the plan is to spend approx $15,000 for every man woman and child in the country.
Q: Do you think you are getting your money’s worth?
Of the $15,000, $7,000 is being borrowed from your grandchildren. (Fine with me – lousy kids with their ipods and rock music.)
Q: Would you rather have an extra $7,000 in your pocket, or would you prefer to pay your neighbor’s mortgage for them?
#11 Holy crap. Our Gov’t is unwinding fast.
The current account deficit imposes what amounts to a significant tax on future GDP growth for a number of reasons. First by moving workers from high productivity and competing industries to public works sectors of the economy. This reduces labor productivity as workers either stay unemployed or gain employment in lower productivity (to GDP) government jobs. Long term new jobs won’t exist without more stimulus monies, which will add to the next problem.
The debt service costs will eat into other spending like research and development (R&D) spending and important investments in human capital. Longer term, this in turn reduces potential annual GDP growth (from say 3% to 1-2%). Lower GDP will cause even higher interest rates in refinancing the debt, and hence lower GDP numbers. So this spending today guarantees low returns in the future. That is what the market is seeing right now, and it’s at 1997 levels because it is projecting a number of years of very shallow growth. 1.7 TRILLION dollars is not a “normal” situation. “Everyone” before Obama didn’t even come close to that number, that number represents about 5 years of deficit spending. So in two years Obama will spend almost three presidential terms worth of money. That’s significant.
The sad part is that after 3-4 years of zombie growth the Left will still blame Bush and the republicans, because that’s the only thing they know how to do.
White House Office of Management and Budget presents totals for President Obama’s 2010 spending plan:
President Obama’s spending and tax blueprint for 2010 will mean the U.S. government’s debt will increase 63 percent in two years.
The publicly held debt — money that is owed by the government to foreign and domestic creditors — was 40.8 percent of gross domestic product in 2008. That increased to 58.7 percent based on projections for the fiscal year that began on Oct. 1, and will rise again to 64.6 percent in 2010 under Obama’s proposed budget.
Gross domestic product is a dollar value of all the finished goods and services produced by the nation. The United States’ GDP was $14.22 trillion in 2008, of which $5.8 trillion was debt held by the public. In 2009, GDP is projected to increase to $14.4 trillion but the publicly held debt will rise to $8.3 trillion. According to Obama’s budget plan, the economy will reach $14.7 trillion. Public debt will rise to $9.5 trillion.
After this budget, the blame it on Bush strategy is going to stop working with the general public. I wonder if BHO will be smart enough to figure this out before the ’10 elections.
I’m not a big fan of the huge debt the Bushes have run up either.
However, in the current crisis, we must remember a few things. Business has no money and has virtually stopped spending, banks have stopped lending, etc. People have no money and have dramatically curtailed their own spending.
If the government stops spending too, expect the economy to completely come to a halt.
Just a thought … by a Nobel Prize winning economist.
http://tinyurl.com/5ufa2n
So much for “Change”
Scott, you should know that most on the right don’t listen to facts, they listen to Rush!
Rush hates stimulus, therefore I hate stimulus.
See? It’s easy. No brain required. And the best part is that they’re not likely to get called traitors for holding the opposing viewpoint. đ
More double talk from the right (the wrong).
Consider:
When Bush borrows a trillion for an elective war the response is “it’s still less than Vietnam on a GDP % basis”
When Obama borrows a trillion to build American infrastructure get out of the current Bush disaster zone, the response is “we ain’t got the money”.
Summary : A bunch of double talking pin heads with no ideas, lots of whining and anxious to get the Palin/Sanjaya ticket off the ground.
An i the only one to be annoyed at being called wealthy by making 250+ k?
#21, I agree. But two wrongs don’t make a right.
@21:”When Obama borrows a trillion to build American infrastructure get out of the current Bush disaster zone, the response is âwe ainât got the moneyâ.”
If he indeed spent most (if not all) of it on real useful infrastructure I’d be jumping of joy and we’d be on a path to recovery. However, when it is spent on the refurbishment of the Govt. buildings, lawns and trains to Las Vegas (never mind mice, pigs and such) it is not real useful infrastructure and it will not start chain of production but just provide small temporary workforce.
There are some useful (but terribly underfunded) infrastructure projects. Why wasn’t every single dime aimed for mice, pigs, lawns,… redirected to high tech infrastructure? Telecommunications, flight control systems, … Why finance train to least productive places like Las Vegas instead of modernizing highly used productive corridors like Chicago, East Coast,… Where is huge chunk of money for high tech military spending (through which we would gain leg up on technological competition around the World)?
# 24 dusanmal said, âWhen Obama borrows a trillion to build American infrastructure get out of the current Bush disaster zone,”
You’d have a point except, less than 20% is going towards infrastructure. So, basically, you don’t have a point…
#22,
At 250k you make more than 99% of everyone in US, and more importantly, you make more than me and I am loaded. I own two houses(paid for). A jet Ski, a boat. I get a new computer just about every year. I lease a new cars every two years. I was almost ready to retire until the Bush economy really kicked in.
Yes, you are rich, deal with it. I am rich with my meager 150k a year income.
If you put your mind to it, you could sock away 700k in t-bills and CDs in 5 years and retire, with an awsome income for the rest of your life.
Are you mind boggling lottery winning, billionare inheriting wealthy? No. But you are wealthy, and have an income that transends financial need.
#24. You have good points and I agree with the principle of not spending money on useless ‘projects’.
My response to that is.
(1) Neither you nor I are qualified to conduct our own line item veto of spending. I wish I can be king for a day, but I’m not.
(2) I’m afraid we still have politics and horse trading conducted in government. You can bitch about it all day long, but it’s a fact. OK? Once you internalize that, you can move on to the bigger picture. Note the bridge to nowhere is from the Moosalini state.
#17 “Just a thought ⌠by a Nobel Prize winning economist.”
Let’s not forget that a couple vaunted “Nobel Prize winners” crashed LTCM a decade ago, ushering in this era of moral hazard.
Recklessly spending money we didn’t have got us into this mess. The crash cannot be avoided but the suffering can sure be prolonged. Just ask the Japanese.
Funny how a couple of year ago nobody, especially from the right wing media was ever talking about Bush’s massive debt financed spending. Now that Democrats are in power it is a huge issue.
I get it now. It’s all OBAMA’s deficit. I will now readjust my sense of reality.
re#1
Dallas,
Thanks for explaining so clearly to this Republican. I read it twice, trying not to move my lips or smudge the screen with my finger.
I’m sure you, being a not-Republican are right, since we on our side are all knuckle dragging morons, but maybe you could explain why your simple solution didn’t work in the 1930’s in America, or in the 1990’s in Japan.
But please use very small words, because unlike you, I’m stooo-pid.
Dan
PS Write back soon. I have some minorities I need to oppress. As soon as I’m done beating my children at church, of course.
I love it when people take TODAY’s mess and critique the non-messer-uppers for policies about past messes 20 to 80 years into the past.
Of course, the essence of Republican -ism is that anything can be punished or derided into compliance with the Republican ideal.
(No child left behind, Katrina, Iraq, Go F*** Yourself [Cheney], Them Goddamn Liberals [McCain, Palin, Bush, Cheney, Nixon, Reagan and millions more], suspension of gay rights [wherever possible], anything-gate and countless other examples.
Doesn’t it seem ironical that if you are a Republican, you can solicit consensual male/male sex in an airport bathroom while bellowing anti-gay rhetoric at the top of your lungs, publicly. And have your party pat you on the back for it? But the gay thing is just a side effect.
Argumentum ad hominem, and argumentum ad baculumâboth roundly discredited as far back as ancient Greeceâare practiced, universally taught tools within the Republican superstructure.
Along comes the ONE GUY who has consistently refused to play these argumentum games, and out come the Big Republican Guns all primed to bash him in the nuts for being so completely incompetent, useless and wrong.
After thirty six days on the job.
Man bites dog. Kettle calls pot black. Penny saved is a drop in the bucket. Film at 11.
I think a truly conservative American political party needs to show up on the US political scene.
One that is interested in, and focused on, conserving the Constitution, money, lives, energy, health, fairness, reason, Mother Earth, freedom and truth.
But such a party would be parsecs away from the current Republican agenda as practiced here today and for the last forty years.
And that’s a through-line that is consistent.