The further to the left or the right you move, the more your lens on life distorts.

Friday, March 26, 2010

90 Percent

You remember the Congressional Budget Office (CBO). You know, the same CBO that blessed the health-care legislation that was recently rammed through Congress by President Obama and the Democratic majority. By law, the CBO is required to "score" a bill using only the information provided within the bill. Taking advantage of this restrictive policy, the President and congressional leaders used a variety of tricks and faints to have the CBO score the bill as a deficit reducer. In reality, an honest accounting of Obamacare indicates it will cost the United States approximately half a trillion dollars in its first 10 years of operation -- and that includes 10 years of taxes collected for six years of services! What happens during the next 10 years is frightening to contemplate.

But let's forget all that. Let's assume that the CBO accounting was absolutely accurate and that President Obama's praise of the CBO's accuracy and integrity was justified. It would seem reasonable, therefore, that the president would embrace a new CBO projection that most of the mainstream media chose to ignore. David Dickson explains:
President Obama's fiscal 2011 budget will generate nearly $10 trillion in cumulative budget deficits over the next 10 years, $1.2 trillion more than the administration projected, and raise the federal debt to 90 percent of the nation's economic output by 2020, the Congressional Budget Office reported Thursday.

In its 2011 budget, which the White House Office of Management and Budget (OMB) released Feb. 1, the administration projected a 10-year deficit total of $8.53 trillion. After looking it over, CBO said in its final analysis, released Thursday, that the president's budget would generate a combined $9.75 trillion in deficits over the next decade.

Gee, the smartest guys in the room underestimated by only $1.2 trillion -- a small 14% error -- nothing to worry about. You have to wonder how much the administration has underestimated the overall cost of Obamacare and how much they will underestimate the staggering costs of other programs that the president in his ideological zeal will try to push through Congress over the next year.

Those of us in the Center understand that elections matter. With the election of Barack Obama, we are witnessing an already profligate government dash toward bankruptcy. And the President and his colleagues in Congress don't seem to care. David Dixon provides some additional and frightening facts:
"An additional $1.2 trillion in debt dumped on [GDP] to our children makes a huge difference," said Brian Riedl, a budget analyst at the conservative Heritage Foundation. "That represents an additional debt of $10,000 per household above and beyond the federal debt they are already carrying."

The federal public debt, which was $6.3 trillion ($56,000 per household) when Mr. Obama entered office amid an economic crisis, totals $8.2 trillion ($72,000 per household) today, and it's headed toward $20.3 trillion (more than $170,000 per household) in 2020, according to CBO's deficit estimates.

That figure would equal 90 percent of the estimated gross domestic product in 2020, up from 40 percent at the end of fiscal 2008.

No worries, folks. The smartest guys in the room have everything under control.