The Truth on the CBO Budget Projections
By Larry Johnson on March 24, 2009 at 9:57 PM in Current Affairs
If you want to understand Barack’s economic fantasy, here is the data from the Congressional Budget Office. The numbers are there in black-and-white. Click on the image to see the full-sized version.
Let me point out a couple of the relevant details.
The first thing you should understand is that there are some basic assumptions built in to the CBO analysis. The numbers in the chart above are a reasonable sunny, optimistic scenario.
Second, let’s not forget that poor, little Barack has inherited a terrible, awful budget deficit. The deficit has created big, big problems for the Golden Child. So, what is Barack’s solution? INCREASE THE DEFICIT. Swell. That makes no sense, but what the hell.
So look carefully at the CBO numbers: Barack Obama is going to spend more money every year compared to what George Bush spent in 2008. Bush’s discretionary spending in 2008 was 1.133 trillion dollars. That is an average of $3777 per every man, woman and child. Barack, by contrast, is slated to spend at least $51 billion more per year than Bush.
How does Barack cut the budget deficit in half? Real simple. He increases personal income taxes, which will produce an additional $350 billion in 2011 and $426 billion in 2012. Couple of points to consider. If the economy is starting to turn around in 2011 this size of income tax increase dramatically increases the likelihood that a recession will be reignited. The majority of the money being raised by taxes will be used to pay for debt, not to “stimulate” the economy. It takes money out of the pockets of people who would normally spend those funds on goods and service.
The cost of the Bush tax cut, over a ten year period, was $1.45 trillion dollars. Okay? Here’s the link. Go look it up. Notice that Barack Obama is proposing to try to recover 50% of the Bush tax cuts in a two year period. It may feel good in terms of political demagoguery but as an economic policy in the midst of a fragile economy it is nuts.
I think the press corps did a better job tonight of starting to ask some tough questions of the Messiah. It was a good first step. Let’s hope in the next go round that some member of press are better schooled in the specifics of the Barack budget legerdemain. We might actually teach the American people a thing or two.
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