With Pres Obama set to release his 2012 Budget on this Valentine’s Day I doubt he will receive much love from Republicans; especially in the House. Obama’s 2012 Budget will propose $3.7 trillion in spending and $1.1 trillion in deficit reduction over the next 1o years. Now with an overall National Deficit of $14 trillion, $1.1 trillion over the next 10 years doesn’t seem like much but it’s a start. What’s lacking from the 2012 Budget are cuts to programs like Medicare, and Social Security.
Here are some other highlights from Obama’s 2012 Budget:
- 2/3 of the money for the $1.1 trillion in deficit reductions over the next 10 years will come from program cuts and 1/3 of the money will come from tax hikes. Well known programs to be cut are as follows; fewer subsidies for lower-income Americans for heating and cooling. And no more Pell grants for summer college. Tax hikes will come from capping charitable deductions for wealthiest at 28% rate. Bush tax rates gone in 2013. Estate tax would rise back to 09 level
- The 5-year spending freeze (at 2011 levels).
- $78B in cuts over 5 years in the Pentagon budget
As I mentioned earlier this budget does nothing to tackle the entitlement spending like Medicare and the impending bankruptcy of Social Security; also what is missing is any mention of tax-reform. The Obama Administration explained this by saying that cuts to Medicare, Social Security and Tax-reform are separate conversations.
We have to have these “conversations” soon, and right neither Republicans or Democrats seem willing to step forward and start that conversation. The only one willing is Rand Paul, as I noted in a previous blog Paul’s ideas are definitely out of the box thinking for Washington but at least he is thinking.
We need to get serious and it needs to happen now!!
We will definitely see heated battles concerning Obama’s budget, but what good will that do if those battles don’t include cutting/reforming programs that carry the most weight in government spending (Defense, Healthcare, and Taxes).
With all that said, before we can move forward with the 2012 Budget we need to find out what is going to happen with the Debt Ceiling? Some Republicans want to play a dangerous game by saying they will vote against raising the Debt Ceiling; if the ceiling is not raised the U.S. Government will default on its bills…