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Obama’s Annual Fiscal Failure

Mr. Obama confirmed his role as Demagogue-in-Chief on April 13, 2011, at George Washington University. In this speech Mr. Obama:

  • Accurately points out the unsustainable nature of the current entitlement state and uses the example of the annual interest on our debt increasing to as much as $1,000,000,000,000 in coming years. (Our current annual Federal revenue is about $2,500,000,000,000.)
  • Excoriates the then recently passed House budget that proposed moving Medicare to a voucher system without mentioning that the extent and value of vouchers is determined by each Congress and President. What Mr. Obama objects to is the individual, rather than the government, taking responsibility for seeking out the best health insurance coverage for their circumstances in a competitive market.
  • Talks about a $4 trillion dollar reduction in the deficit over ten years but never offers details of spending cuts.
  • Says we must uphold our commitments to social security and health care for all citizens while making these promises affordable without offering any specifics (but wait, I just noted he excoriates the specifics in the House budget), even though every actuary in the government has run the numbers and knows the current commitments are unsustainable (didn’t Mr. Obama note that earlier in this speech?).
  • Plays the populist fiddle about “rich people” paying their fair share without acknowledging that the social security and health care entitlement liabilities cannot be resolved with tax increases on “the rich.”
  • Talks about the 1% of “rich” Americans who are better off than they were ten years ago but fails to mention that his plan increases taxes on singles making over $200,000 per year in income and couples making over $250,000 (millions of these people are specifically not the 1% straw men).
  • Fails to mention the nearly 50% of American’s who pay no income taxes and the 30% who actually receive checks through refundable tax credits.
  • Fails to mention that the Bush tax changes he believes unfair and which he blames for our current out of control debt and deficits also included increases in earned income tax credits that took somewhere between 6 to 10 million Americans OFF the tax rolls.

So, rather than work together to restructure our tax and entitlement programs to put both on a sustainable course that would support economic growth, Mr. Obama decided to play ideological political chicken with our country’s future in hope of eventually getting his way, that being – take more tax dollars from people earning over $200,000 a year and redistributing it to everyone else while leaving our unsustainable entitlement liabilities basically intact.

Mr. Obama released his 2013 budget proposal in February 2012. So, what leadership has been demonstrated since his April 13, 2011 speech? None. His 2013 budget seeks even more tax increases on the “rich” than proposed earlier while claiming trillions in spending cuts that still result in trillion dollar annual deficits. The “cuts” are either illusory (claiming credit for money not spent in the future on the occupation of Iraq because our military forces have withdrawn -really!) or result from projected reductions in the rate of growth in existing programs (not actual cuts in spending). If we follow Mr. Obama we will be taxing success at extraordinary levels while continuing to spend money we don’t have. The private economy will not grow fast enough to finance further deficit spending because money available for investment will be reduced by tax increases.

What, you ask, is the solution? We need to fundamentally restructure social security, medicare, and medicaid so that each generation pays their own way. (Remember, my daughter gets it and is not too happy.) We need to reduce the role and leverage of the Federal government in health care, housing, environmental policy, energy, and the financial industry so the focus is on enforcement rather than government participation, open markets rather than government mandates. We need to empower the States to compete among themselves for employment and opportunity. We need to change the tax code so it does not favor any types of expenditures (neither crony capitalism nor crony unionism) and removes the burden on double and triple taxation on dividend and non-US income. More simply put, we need a Federal government committed to empowering the individual.

We need to fill the United States Congress and the Presidency with citizens committed to limiting the role of the Federal government to the protection of our freedoms, rather than one rapaciously claiming those freedoms for its own purposes.

Posted in Freedom, Money.


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