In his first five months of office, President Obama has initiated an unprecedented spending spree. He signed a $787 billion stimulus bill into law, continued spending from the second half of the $700 billion Troubled Asset Relief Program (TARP) funds authorized by Congress during George W. Bush’s term, proposed a $3.6 trillion budget for the next fiscal year, and created other billion-dollar programs with the intent of stimulating the economy.
At the weekly bloggers briefing held at the Heritage Foundation on June 9, Congressman Dan Burton (R-Indiana) spoke out against the current administration’s massive spending. He argued, “We are on the precipice of real problems if we don’t get control of our spending.”
According to statistics from the Peter Peterson Foundation, the federal government is carrying 56.4 trillion dollars in publicly held debt. Individually, that means that each and every American is carrying a burden of $184,000. “And every year in which no down payments or reforms are made to these obligations, the total grows by $2 trillion to $3 trillion,” asserted Burton-—that means an additional $6,600 to $10,000 per person.
How did we get to $56.4 trillion in debt?
“First, there are the federal government’s known liabilities that it is legally-obliged to fulfill. These include publicly held debt, military and civilian pensions and retiree health benefits. As of September 30, 2008, these liabilities added up to $13.5 trillion,” the Peter Peterson Foundation states.
“Then there are various commitments and contingencies— i.e., contractual requirements that the government is expected to fulfill when, and if specified conditions are met. These include federal insurance payouts, loan guarantees, and leases. As of September 30, 2008, they added up to $1.4 trillion.”
The remaining $43 trillion comes from “what the government has promised to pay in Social Security and Medicare benefits in excess of related revenues. As of January 1, 2008, current and promised future Social Security benefits amounted to $6.6 trillion. And between Medicare’s three programs (hospital insurance, outpatient, and prescription drug), current and future promised Medicare benefits amounted to $36.3 trillion.”
“We are in a position right now where we can destroy America as we know it,” argued Burton. “People are saying it can’t happen here in the United States, but I am telling you it can.” Burton is currently a part of a bi-partisan effort to establish a Commission similar to the Grace Commission of the Reagan years. The purpose of this Commission would be to make recommendations about where cuts can be made to move towards a balanced budget and avoid the “precipice” that we face now.
“Every single American should be concerned about this because the future of this country… is in jeopardy,” Burton continued. “This is not political rhetoric … if we don’t get control of our spending we will have horrible problems down the road and you are going to live to see it. I might not, but I guarantee you are.”
Not surprisingly, the media has played down the effects of this administrations massive spending.
Peter Orszag, the director of the Office of Management and Budget (OMB), blamed George W. Bush for the current deficit in a recent blog post: “The deficits in these years, now projected to be 12.9 percent and 8.5 percent of GDP, respectively, are driven in large part by the economic crisis inherited by this Administration.”
The New York Times echoed Orszag’s sentiment in an article in May:
“The President’s budget director, Peter R. Orszag, disclosed the deficit revisions Monday in his blog on the budget office’s Web site. He said they were ‘driven in large part by the economic crisis inherited by this administration.’ He cited Treasury estimates that revenue collections would be $30 billion to $50 billion less this year and next compared with February calculations, and higher-than-expected costs for bank bailouts.
“Congressional Democrats echoed the reference to the inheritance from President George W. Bush. ‘It took eight years for the previous administration to dig this hole. It is going to take time to climb our way out,’ Senator Kent Conrad of North Dakota, chairman of the Senate Budget Committee, said in a statement.”
What Orszag and The New York Times fail to disclose, however, is that the 2009 budget was approved by then-Senator Barack Obama along with all the Democrats in the Senate. In fact, the overwhelming majority of Republican Senators—except for two—opposed the budget. The current administration and the media continue to point fingers backwards without realizing that they are pointing at themselves.