Barack Obama

President Obama's Budget: It's Always a Good Time to Spend More!


Barack Obama has released his budget proposal for fiscal year 2016, which begins in October. The best thing about the plan is that it's released on time this year. That's been all too rare an occurrence, and not just for the president: One of the most stunning yet under-reported stories of the past several years is the unwillingness and inability of the federal government to hit basic deadlines when it comes to budget issues. Of course, coming up with a plan, which is typically a wish-list, is only the beginning of a budget process that has gotten seriously FUBAR during the Obama years.

Not that the outcome of such problems is necessarily bad: The main reason why federal spending flattened and declined after 2010 is precisely nobody involved in the process could hit their deadlines. The subsequent arguing over everything, coupled with a rare willingness to debate raising the debt ceiling or—horror of horrors—tying an increase in spending now to fiscal rectitude, helped keep spending from exploding as it did under George W. Bush and the Republican Congress, plus the first two years of Obama's presidency.

The big numbers in Obama's budget are these: He wants to increase total spending to $4.1 trillion, up from $3.9 trillion in fiscal 2015. Total revenues are expected to be $3.7 trillion, up from $3.3 trillion (see table S-1). As per the ritual, there are projections for the upcoming decade, which are meaningless and even less binding that the president's plan for this year.

Obama's budget message is the same sort of ideological meringue he's been whipping up for years now. It's heavy on rising inequality and the role of government in…taking money from the wealthiest and…saying it will use it somehow to buffer global trends in wages:

Today, after 4 years of economic growth, corporate profits and stock prices have rarely been higher, and those at the top have never done better. But average wages have barely budged. Inequality has deepened. Upward mobility remains stalled. Even in the midst of recovery, too many Americans are working more than ever just to get by—let alone get ahead. And too many still are not working at all. Our job is to reverse these trends. We need to return to an America where our success depends not on accident of birth, but on the strength of our work ethic and the scope of our dreams. That is what drew our forebears here. Opportunity is who we are. And the defining project of our generation is to restore that promise. It will not happen right away. But we must continue to strive toward that goal.

Most interesting in this the passive acknowledgement that "upward mobility remains stalled." Typically, Obama and many Democrats and Republicans have been stressing the mobility is decreasing or a thing of the past. That is simply not true and it's kind of nice to see the president note that (he was singing a different tune even a year ago), at least on the down low.

As The Hill notes, Obama's budget "busts" spending caps that were put in place a few years ago.  One of the bigger ticket items is a six-year "infrastructure" plan to build more roads and bridges, and the big news on the tax front is a corporate tax plan that would allow U.S. companies to bring home overseas profits and pay a lower rate on them.

Politico is calling this document "Barack Obama's 'have-it-all' budget" and not without reason. It increases discretionary spending by $74 billion over what sequestration was supposed to allow. It doesn't pretend to balance the budget but through rosy projections of various sorts claims to stabilize and slighly reduce the national debt over the coming decade. It increases entitlement spending (from $2.4 trillion to $2.57 trillion) and grows defense spending (see table S-4), which will be a bargaining chip with Republicans who just want to keep spending more on defense.

As Maryland Democrat Rep. Chris Van Hollen said shortly before the State of the Union Address, "We believe [Democrats and Republicans] should work together to lift the caps on both" military and non-defense spending.

Consider it done. Obama's budget is not inspirational, or bold, or anything. It's basically the same document that he's been kicking around for several years. This time, however, he's on time with its delivery, the economy is marginally better, and it's been a while since the feds have gotten a chance to increase spending.

When you combine that with a new Republican congressional majority that has constituents and interests to pay back, and Obama's willingness to boost defense spending (despite the end of two wars and a huge increases over the past 15 years), I suspect that Obama and Congress will indeed find a way to increase spending across the board even as they argue that the other is bankrupting the country, killing the very soul of the country, and dancing on the graves of the poor, the old, the middle class, and the good, honest people of America who have not yet been born.

The whole budget is online here.

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  1. You might want to compare Year Six of the Obama administration with Year Six of the Reagan administration. Guess who spent a bigger percentage of GDP?

    (Hey, I’m no Obama supporter, but facts are stupid things.)

    1. Yeah. I’ve never figured out how Reagan became the Patron Saint of Fiscal Conservatism. If that’s the case, then I should be paying my mortgage with a credit card.

      1. I should be paying my mortgage with a credit card.

        I actually thought about this, but only because the credit card in question is a rewards card and I don’t carry a balance on my credit card. The mortgage company won’t take a credit card for payment.

    2. just because someone else gets shot doesn’t mean I shouldn’t go to the hospital when I get stabbed.

    3. Guess who controlled Congress when Reagan was President? Guess how much of GDP Tip O’Neil and George Mitchell would have gladly spent if they didn’t have to compromise with Reagan?

      Why do people always think Reagan was king?

      1. When the other party has the White House, then it’s all their fault. When the other party has Congress, then it’s all their fault. Duh.

      2. The difference between a GOP Pres/Dem Congress and vice-versa is that the Dems refuse to compromise when they control Congress, and the GOP just asks “Are my legs spread apart far enough?”

    4. Not to defend Reagan, but it was the Cold War. Hence why spending plummeted under Bush 1, first post-Soviet president. One could hold Bush up as the icon of fiscal conservatism, but in reality he just inherited auspicious circumstances.

    5. That may be true but how much percentage of the government income was paid on the debt at that time compared to now and how long before the payment on the ever increasing debt really damages spending?

  2. And so the national debt grows yet again. But we are told deficits no longer matter, the stock market is up, unemployment is down, inflation is almost non-existent, the rise of oil prices has been reversed, etc. etc. Why we don’t just crank out another 2 or 3 or 10 trillion in stimulus money to “rebuild our infrastructure” is beyond me.

    1. I’ve got a bullet train from Fresno to Merced that needs funding.

  3. …I suspect that Obama and Congress will indeed find a way to increase spending across the board even as they argue that the other is bankrupting the country…

    So then it’s win-win.

  4. One of the bigger ticket items is a six-year “infrastructure” plan to build more roads and bridges

    Let them eat ROADZ!

    1. Spending on roads is good. Roads themselves are still bad, though; let them ride light rail.

      1. yes, because we need to control points a and b of your travel plans.

    2. Get those shovels ready….
      to fill your bank accounts.

  5. 1. I grant your request for bigger government
    2. You grant my request for bigger government
    3. ???
    4. Bipartisanship!

    1. That is what centrism gets you.

      It’s the great myth of compromise.

      1. “In any compromise with evil, evil always profits.”
        -Ayn Rand

        1. Here, though, it’s two nameplates for evil. It’s like the Evil Plymouth Neon and the Evil Dodge Neon.

          1. Double the evil, double the profit.

            1. is that why KFC did the doubledown?

          2. It’s the Stupid and Evil parties. They’re both stupid and evil.

  6. I’m not sure a president should be able to propose spending that happens after he’s left office.

    1. I’m not sure a president should be able to propose spending that happens after he’s left office.

      I know, I’m dreaming.

      1. hahahaha. how else could he give away free stuff to his funders… I mean voters.

    2. Why not? I propose a 25 percent budget cut every year.

  7. Of course, coming up with a plan, which is typically a wish-list, is only the beginning of a budget process that has gotten seriously FUBAR during the Obama years.

    Oh, what the heck! Just abolish money and force the populace to implement whatever is on the wish list.

    1. can we start using eggs as currency? chicken eggs only, of course. all ostrich eggs will only be used by the fed.

      1. Yes, chicken eggs may be used in the brief transitional period before everyone is a government employee.

      2. How long before inflation kicks in and we’re all making omelets with hummingbird eggs?

        1. hummingbird eggs are only attainable to those who already own monocles.

          It will be platypus eggs for the rest of us.

    2. Working on the roads will give you some much needed exercise. Win-win!

      1. “Let’s Move, So We Can Move!”

  8. In Obama’s defense, it’s always a good time to tax and regulate more too.

    1. In good times, we have the opportunity to expand government. In bad times, we have a moral imperative to expand government.

      1. Yes, it all balances out that way. In a recession, we can’t afford to cut government spending. In times of prosperity, we don’t have to cut government spending.

  9. epluribus unum

    “We believe [Democrats and Republicans] should work together to lift the caps on both” military and non-defense spending.

  10. Nick, your chart shows spending peaked in both major categories in 2008/09 and has fallen annually since.

    Why do you hate Team Red?

    1. The chart also shows that spending has not declined to the level it was before 2008, either.

      1. I love that he continually defends Obama’s spending and tries to pretend that he has done anything to reduce the deficit or the debt. Especially in an article where it’s laid out that Obama want’s to spend $4.1TT. Which is $1.2TT more than the 2008 budget.

        1. It’s because he is a statist hack. Anything to keep you from talking about how this group is just as horrible as the other. Change the subject, interject bullshit, and ignore the fact the government keeps getting bigger and our problems aren’t getting smaller.

    2. I’m gonna raise spending by $1 trillion for 10 minutes.

      10 minutes later I’ve cut spending by $1 trillion!!

      Your misdirection and contortions don’t play on here, scumbag.

    3. Retard is ‘tarded. News at 11.

    4. Is 4 trillion not greater than 3 trillion anymore? I guess I’m not as tuned in the the Ministry of Truth as you are.

  11. Have some more paint thinner, Shreeek.

  12. It increases entitlement spending (from $2.4 trillion to $2.57 trillion)

    The SS/Medicare roles are growing due to demographics.

    1. So start by cutting everything else by at least 170 billion.

  13. There’s a reason why both politicians and the public have become uninterested in the Federal budget.

    The Federal budget was interesting back in the 20th Century because competing budget formulations and debates, and the eventual resolution actually meant something.

    Every aspect of the Federal budget is now exceptionally boring. Most of the Federal budget goes to welfare entitlements, and it is now clear that no American politician of either party is going to advocate serious cuts to any of these. The defense budget is a joke: there’s a blank check for any spending that the jokers in the war and foreign policy branch of government want. The financing costs are a fiction managed by the Federal Reserve. And that fiction grossly distorts the unit of account used to measure the Federal budget. The Federal government also underwrites enormous off-budget items that threaten to blow up without notice.

    Even in the 20th Century, the budget itself was always just been this side of incomprehensible, so most people just focused on the bottom line of spending and deficit. Those numbers were actually meaningful even though there was a plenty of phony accounting even back then. The real Federal budget has become an epic farce in the 21st Century, which makes it totally unworthy of serious interest.

    1. Most of the Federal budget goes to welfare entitlements, and it is now clear that no American politician of either party is going to advocate serious cuts to any of these.

      Republicans have tried making modest changes a couple of times, but even those cause the democrats to throw a temper tantrum and cause a fake government shutdown.

      And Stockholm Syndrome republicans like John Boehner are fully convinced that these fake government shutdowns are disastrous for them, even though there’s very little evidence to support that.

  14. Most of the Federal budget goes to welfare entitlements

    I doubt that the SS/Medixxxx/VA crowd likes their $1.8 trillion in entitlements called “welfare” although I might agree based on tax policy.

    Real welfare (food stamps, TANF) is relatively small although wingnut AM radio likes to plant the opposite notion in the small minds of their listeners.

    1. it is, by definition, welfare. it’s the pillar of the welfare state ideal that some have.

      1. Fine. Just tell them that and duck.

        1. On rare occasions, I check Free Republic (where the median age is somewhere between 60 and dead) to see if there is a social security article, and do just that. The responses to my comments there are as derptastic as any troll’s comments here at Reason.

        2. Clearly, they must be right, if they get so angry at someone else’s opinion.

    2. And Obama (and company) is just leading the charge on reforming this… right?

      1. Line by line, friend. Line by line.

    3. With the solitary exception of treating veterans with service-related disabilities, SS/Medixxxx/VA are key components of the welfare state. (The exception the consequence of the permanent warfare state.)

      Regardless of what they want to think, virtually all geezers are welfare recipients.

      But remember you young whippersnappers: Social Security is a “sacred compact between the generations” as President Bill Clinton put it. Our parents ripped us off, just like their parents put the screws to them to get their welfare benefits. Sure, you’re getting screwed by the ageing boomers now, but under the sacred compact, you will rip off your children when you eventually arrive at geezerhood.

  15. One of the bigger ticket items is a six-year “infrastructure” plan to build more roads and bridges…

    You know, while someone could make a “public good” argument around infrastructure spending in principle, the utter mendacity with which these proposals are presented just leaves me outraged.

    We’re told that our infrastructure is falling apart. That the world will come to an end unless we write a big check to fix and repair our crumbling infrastructure. It’s an absolute crisis.

    Not long after the check is written, the story changes. We’re warned that, of course all of this infrastructure work will have to go through environmental review. And aesthetic review. And we can’t really do the project unless we sweeten the deal for the local community with a new community center. Oh, and we can’t forget that at least some of the work on these projects will have to go to historically disadvantaged contractors. At union scale. And to do this project, we’re going to have to build a new highway in Senator Bumblefuck’s district, since it’s lack of infrastructure is obviously why it’s so poor. And what’s so special about roads and bridges anyway? The Europeans are doing some amazing things with high speed rail. And…

    At the end, we’re left with a public toilet and a repaving, for all the billions we’ve spent. At that point, we’re told that our infrastructure is falling apart. That the world will come to an end unless we write a big check to fix it.

    1. Yup

    2. Infrastructure is always crumbling. Yet somehow the Romans built bridges 1700 years ago that are still in use.

    3. You forgot the diesel and gasoline tax that is increased some between the announcement of the massive infrastructure plan and the recognition of its utter failure.

      This is inevitable, even though the total taxes raised on transportation fuels cover spending on roads and bridges several times over.

      The statist will say, of course, that diesel and gasoline taxes only cover 70-80% of the cost. He’s conveniently forgetting about the severance taxes; royalties; customs duties; taxes on oil company, pipeline, and retailer profits and royalty income; etc., etc., etc.

  16. Obama is a moron, plain and simple.

  17. When will our long nightmare of austerity end?

  18. Here’s a crazy idea: How about we only spend whatever we take in?

    I mean that’s still not great cause if your budget is 3.3 and you take in 3.7 maybe you could give that money back to the people you took it from, but I know that’s complete wishful thinking.

    1. Or pay down some debt – but that is crazy talk.

  19. Anyone catch outgoing CBO head Doug Elmendorf a few days ago testifying that our national debt will become unsustainable in 25 years?

    If the CBO says 25 years, that means in reality it’s probably more like 15-20 years, given their absolutely dismal track record of predictions.

    1. That ratfucking teabagger is just a Keynsian denier. I read the NY Times not Fox News so I know there’s a peer reviewed consensus that what we need is more spending.

    2. The traditional and time-tested warning sign that you are fiscally fucked is when your national debt exceeds your GDP.

      Congrats, America! You have been officially fiscally fucked since 2012.…..FDEGDQ188S

  20. The 4 Trillion Dollar Budget.

    Because 10 billion dollars a day just wasn’t enough.

  21. We’re out of the recession, right? So what happened to Keynesians being all about counter-cyclical fiscal policy?

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