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Obama - My $1 trillion deficit is Bush's fault!

Of course Obama didn't meniton that OBAMA himself along with McCain voted for the last $700 billion handout to the poor Wall Street brokers and bankers which is almost responsible for the $1 trillion deficit. And of course Obama in this article talks about another $800 billion in handouts, which is $1.5 trillion in total corporate welfare.

And in the same breath he talks about "banning pork-barrel spending".

About the only thing we can really count on the government in Washington to continue doing is stealing our money and giving it to themselfs and special intrest groups.

Source

Obama criticizes Bush for doubling U.S. debt

by Steven Thomma - Jan. 7, 2009 12:00 AM

McClatchy Newspapers

WASHINGTON - President-elect Barack Obama on Tuesday ripped outgoing President Bush for "irresponsibly" doubling the federal debt, then warned that he could preside over trillion-dollar-a-year deficits for "years to come."

Huddling with his budget team, Obama told reporters he would ban pork-barrel spending projects known as earmarks from his proposal to stimulate the economy. He also vowed to make the difficult choices necessary to curb runaway deficits and debt.

He said, however, that he wouldn't propose his first federal budget until after the stimulus proposal, which itself could cost about $800 billion. And he cautioned that staggering annual deficits would continue even after that.

"At the current course and speed, a trillion-dollar deficit will be here before we even start the next budget," Obama said at his Washington transition office.

"We're already looking at a trillion-dollar budget deficit or close to a trillion-dollar budget deficit, and ... potentially we've got trillion-dollar deficits for years to come, even with the economic recovery that we are working on at this point."

He also defended his choice of Leon Panetta to be director of the CIA - despite his having no direct experience in intelligence gathering - and said he'll have "plenty to say" about the Israel-Gaza fighting after he takes office in two weeks.

Obama stressed that Panetta's experience as a congressman and White House chief of staff will help him and others reverse Bush administration policies such as allowing torture.

"He is one of the finest public servants that we have. He brings extraordinary management skills, great political savvy, an impeccable record of integrity," Obama said.

His team also worked to repair some of the political damage caused by failing to notify Sen. Dianne Feinstein, D-Calif., the incoming chairwoman of the Senate Intelligence Committee, of the coming nomination.

"It's always good to talk to the requisite members of Congress," Vice President-elect Joe Biden told reporters on Capitol Hill. "I think it was just a mistake."

Feinstein said later she'd been contacted by both Obama and Biden.

On the budget, the specter of deficits and debt dominated Obama's meeting and comments to reporters as he prepared to give a major speech Thursday on the economy.

The federal debt nearly doubled under Bush's watch, from $5.7 trillion to $10.6 trillion. With trillion-dollar-a-year deficits added to that, the total debt burden could soar much higher. And it would come just as the government starts to face the growing burdens of medical care for retiring and aging baby boomers.

Source

$1.2T deficit projected for '09

Jan. 7, 2009 09:25 AM

Associated Press

WASHINGTON — The federal budget deficit will hit an unparalleled $1.2 trillion for the 2009 budget year, according to grim new Congressional Budget Office figures.

The CBO estimate released Wednesday also sees the economy shrinking by 2.2 percent this year and recovering only slightly in 2010, and the unemployment rate eclipsing 9 percent early next year unless the Obama administration steps in.

“The recession — which began about a year ago — will last well into 2009,” the CBO report says.

The dismal figures come a day after President-elect Barack Obama warned of “trillion-dollar deficits for years to come.”

CBO's figures don't account for the huge economic stimulus bill Obama is expected to propose soon to try to jolt the economy. At the same time, they do not reflect the immediate cost of the Wall St. bailout.

The shrinking economy has led to a sharp drop in estimated tax revenues of $166 billion, which is largely responsible for the deficit, along with big outlays from the Wall St. bailout.

The agency expects the $700 billion bailout to actually cost taxpayers $189 billion, with the costs reflected in its estimates for this year and next. CBO estimates take into account the net value of the assets the government holds from financial institutions.

Under Treasury Department accounting, the bailout is reflected on a cash basis with disbursements reflected as the government makes them; as of mid-December, those disbursements totaled $238 billion. Exposure to the taxpayer stemming from the Federal Reserve Board's extensive interventions in the financial markets — such as acquiring 80 percent control of insurance and financial giant American International Group Inc. — are not reflected in the estimates.

Obama and Congress are promising quick enactment of the economic recovery plan, which will blend up to $300 billion in tax cuts with big new spending programs and could cost up to $775 billion over the next few years.

The flood of red ink probably won't affect that measure but could crimp other items on Obama's agenda.

“Despite the record deficits facing us, our number one task is an economic recovery package,” said House Budget Committee Chairman John Spratt Jr., D-S.C. “With Americans concerned about their jobs, their homes, their retirement and their children's future, our economic situation is so severe that stabilizing the economy must take precedence over short-term deficits.”

The $1.19 trillion 2009 figure shatters the previous record of $455 billion, set only last year. It also represents more than 8 percent of the size of the economy, which is higher than the deficits of the 1980s. The 2009 budget year began last Oct. 1.

Senate GOP Leader Mitch McConnell of Kentucky called the budget figures “a stunning and sobering reminder that Congress must strengthen its efforts to be good stewards of the taxpayers' money.”

CBO predicts the deficit will come under relative control within a few years, dropping to the $250 billion range within five years. But such predictions depend on the expiration of President Bush's tax cuts at the end of next year; Obama has promised to renew most of them except for those aimed at people making more than $250,000 a year.

Fully renewing the Bush tax cuts, as well as indexing the alternative minimum tax for inflation, would add $380 billion to a deficit otherwise projected at $327 billion for 2012, CBO says.

At the same time, Democrats are expected to increase domestic agency budgets as they complete the leftover 2009 spending bills, and Obama is likely to recommend further increases in next month's budget submission.

While expected, the deficit numbers will give lawmakers second thoughts about creating new spending programs without finding ways to pay for them. And it is likely to prompt a debate about whether tax increases are necessary after the economy recovers from the current recession. On Wednesday, Obama said, “Unless we take decisive action, even after our economy pulls out of its slide, trillion dollar deficits will be a reality for years to come.”

“I'm going to be willing to make some very difficult choices in how we get a handle on this deficit,” Obama said Tuesday.

Economists warn that large and sustained budget deficits put upward pressure on interest rates. In the short term, however, efforts to restrain the deficit could have a contracting effect on the economy.

“As we address our economy, it is vital that we simultaneously take steps to put our budget back on a sound long-term fiscal path,” said Senate Budget Committee Chairman Kent Conrad, D-N.D.

Source

Stimulus aside, Obama vows budget restraint

Jan. 7, 2009 06:43 AM

Associated Press

WASHINGTON - To a public wary of government spending, President-elect Barack Obama is offering a salve with his massive economic stimulus package: the promise of long-term fiscal discipline.

Budget-conscious lawmakers are pressing Obama to embrace deficit-reduction goals even as he promotes a spending and tax-cutting plan - expected to cost about $775 billion - to jolt the economy out of its downward spiral.

"Part of the discussion that needs to happen right now is not what we do just right now, but what we look to in the future - about how we get back to a balanced budget and then start to deal with this horrible, horrible national debt that we have," said Rep. Dennis Moore of Kansas, a member of the congressional Blue Dogs, a coalition of conservative and moderate Democrats.

Two weeks away from assuming the presidency, Obama vowed Tuesday to "bring a long-overdue sense of responsibility and accountability to Washington" and called the need for budget reform "an absolute necessity."

On Wednesday, he was expected to announce Nancy Killefer as his chief performance officer, a White House official who will work with federal agencies to set performance standards and hold agency managers accountable for progress. Killefer is director of a management consulting firm and served as an assistant secretary of the Treasury under President Bill Clinton.

"The fact that he is making these comments publicly about fiscal responsibility gives me encouragement that we will see something," said Rep. Charlie Melancon of Louisiana, one of the leaders of the Blue Dog Coalition.

With Democrats in control of both chambers in Congress, Obama's reassurances to budget hawks from both parties already appear to be making a stimulus package more palatable. Obama said this week he would like Congress to complete action on an economic recovery plan by the end of the month or the first week of February.

House Speaker Nancy Pelosi, D-Calif., was expected to press fellow Democrats on Wednesday to pass the legislation by mid-February. She, too, has reassurances for cost-conscious lawmakers.

"Many will focus on the upfront cost of this legislation," she was to tell a House Democratic Policy and Steering Committee forum, according to an excerpt of her prepared remarks. "While we are not discussing small sums, focusing on the price tag alone ignores the cost of inaction and the real payoff in terms of job creation and increased revenues to our Treasury."

While promising to fight waste and to make tough budgetary decisions, however, Obama warned that the nation could face trillion-dollar deficits for years to come. Eight years ago, the federal budget ran a surplus; the deficit on Sept. 30 was about $455 billion. That was before the government began spending nearly half of a $700 billion bailout fund for the financial sector.

Obama said Americans will accept his proposed stimulus plan only if they believe the money is being used wisely to boost the troubled economy and to make smart long-term investments in public projects.

Lawmakers and budget watchdog groups want Obama to promptly spell out a process for addressing long-term deficits.

"Short-term stimulus does need to be combined with long-term discipline," said Robert Bixby, the executive director of the Concord Coalition, a nonpartisan group that advocates fiscal restraint. "The deficit numbers are going to be astronomical for the next couple of years. People need to know that there is some end game to this."

Senate Budget Committee Chairman Kent Conrad, D-N.D., agreed that trillion-dollar deficits are likely for a few years and must be tolerated as the government pumps money into the badly weakened economy. But the nation must confront long-term problems facing Social Security and Medicare, he said, which will be "very, very tough."

"It would send a very healthy message to the markets and the American people if President-elect Obama were to simultaneously announce an economic recovery package and the beginning of a bipartisan process to deal with our long-term imbalances," Conrad said.

Obama has not detailed solutions for vexing problems such as growing demands on Social Security and Medicare. His prescriptions to make government accountable could easily run aground, much like those of predecessors who vowed to tackle government waste, fraud and abuse.

But lawmakers are not short on ideas. Conrad and the Budget Committee's top Republican, New Hampshire Sen. Judd Gregg, have proposed a bipartisan fiscal task force of lawmakers and administration officials that would create a plan to reduce budget deficits and lower the national debt.

Blue Dog Democrats would like to see legislation that would force Congress to pay for spending proposals with equal spending cuts or with new revenue. House Democrats this week plan to consider legislation that would require all federal agencies to undergo new audits and would call for congressional hearings when agency inspectors general find evidence of waste or fraud.

On the Net:

Obama transition: http://www.change.gov