Obama Budget Doubles Down on Deficit Spending Failure

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Standing in front of a Baltimore County middle school yesterday, President Barack Obama said, “Even as we cut out things that we can afford to do without, we have a responsibility to invest in those areas that will have the biggest impact in our future. And that’s especially true when it comes to education.” Accordingly, the President’s budget includes a $77 billion increase in Department of Education spending from the 2010 budget. But this is hardly the first time a White House has significantly raised education spending.

In fact, since 2001 federal education spending has already increased by 100 percent. And going back to 1970, it has almost tripled. And what have been the results of this federal “investment” in our future? Nothing. Department of Education spending has completely failed to raise student achievement over the past 30 years. This is the story of President Obama’s budget: too much spending, too much taxes, and too much borrowing—all of which has already failed to create jobs today and will make it harder for our children to find jobs in the future.


Since President Barack Obama was sworn into office, total entitlement spending has grown 4 percent, total discretionary has soared 16 percent, and the national debt has exploded 43 percent. Over that same time the United States economy has lost 3.3 million jobs. President Obama cannot be blamed for the most recent recession, but he can certainly be held accountable for the failure of his deficit spending policies in response.

The fiscal year 2012 budget released yesterday by the President doubles down on this failed record. The White House is trying to portray this document as a spending cut. Specifically, they claim the President’s budget reduces 2012 discretionary spending by 5 percent. But as Heritage Foundation scholar J. D. Foster details, these “cuts” are made possible only by three gimmicks: (1) redefining Pell grants as mandatory spending, (2) reclassifying $54 billion of surface transportation spending from discretionary spending to mandatory spending, and (3) reducing funding for Iraq and Afghanistan by $38.2 billion in 2012. Reversing these budget tricks not only wipes out the entirety of President Obama’s claimed $77 billion in spending cuts; it actually reveals them to be a $31 billion increase in discretionary spending. This is moving the ball in the wrong direction, and the American people know it.

According to Gallup, unemployment is by far the number one concern of the American people. And when you ask people how the federal government can best improve our economy, deficit reduction is the top strategy. And, in fact, there is a relationship between debt levels and economic growth. Carmen Reinhart of the University of Maryland and Kenneth Rogoff of Harvard University studied the relationship between rising debt levels, inflation, and economic growth rates for 44 developed and developing countries. They found that debt burdens of over 90 percent of GDP were associated with a significantly slower economic growth. President Obama’s budget pushes us over that mark: By the end of next fiscal year, the White House projects that our national debt will be $15.476 trillion, or 102.6 percent of GDP. We can’t expect our economy to recover under this debt burden.

As troubling as President Obama’s failure to cut discretionary spending is, his failure to address our nation’s impending entitlement crisis is even worse. Under current policy, spending on Social Security, Medicare, and Medicaid will consume all tax revenues by 2052. We must cut entitlement spending before our economy can truly recover. The first step is the full repeal of Obamacare’s brand new $1 trillion spending increase. Then, after undoing the damage Obama has caused, conservatives should go further by turning Medicare into a defined contribution system and focusing Social Security benefits on those who really need them during retirement.

President Obama cannot continue to pass on unsustainable levels of spending and borrowing to future generations. The president himself will tell you that spending levels under President Bush were unsustainable and yet objects to returning program budgets to even 2008 levels. In November 2010, Americans demanded an adult conversation about what government does and how much of our money it spends. It is up to the president to demonstrate he heard the American people and defend why federal programs, like education, are effective enough to warrant more money. And when he can’t show any measurable results, like in the area of education, he must agree to responsible cuts. The status quo is no longer affordable.