Obama’s Deficit Reduction Plan Will Look Beyond the “Twelve Percent”
President Obama just finished his speech at George Washington University. He drew a sharp line between the Republican budget proposal and his own vision for reducing the deficit while preserving the social safety net.
The most important thing the president did for transportation in his speech is steer the scrutiny away from the 12 percent of the federal budget that pays for “education and clean energy; medical research and transportation; food safety and keeping our air and water clean.” If we’re really going to deal with the deficit, he said, we’re going to need to deal with the other 88 percent.
Around two-thirds of our budget is spent on Medicare, Medicaid, Social Security, and national security. Programs like unemployment insurance, student loans, veterans’ benefits, and tax credits for working families take up another 20 percent. What’s left, after interest on the debt, is just 12 percent for everything else.
The last few rounds of spending cuts, during which transportation advocates have begged and prayed and hidden their eyes from the carnage, have tried to extract a whole budget’s worth of overspending from just a few small programs. If the president can tackle the bigger issue and leave some of those programs alone, it’ll be a huge relief to transportation advocates, transit agencies, and DOTs.
Up until now, the cuts proposed by a lot of folks in Washington have focused almost exclusively on that 12 percent. But cuts to that 12 percent alone won’t solve the problem. So any serious plan to tackle our deficit will require us to put everything on the table, and take on excess spending wherever it exists in the budget.
Obama’s plan borrows from the recommendations of the deficit commission but he does not promise to hew to them entirely. He says he’ll reduce the deficit by $4 trillion over 12 years and, yes, he still says we’ll “win the future.”
Meanwhile, he rejected the GOP plan, calling it a “pessimistic” vision of America.
A 70 percent cut to clean energy. A 25 percent cut in education. A 30 percent cut in transportation. Cuts in college Pell Grants that will grow to more than $1,000 per year. That’s what they’re proposing. These aren’t the kind of cuts you make when you’re trying to get rid of some waste or find extra savings in the budget. These aren’t the kind of cuts that Republicans and Democrats on the Fiscal Commission proposed. These are the kind of cuts that tell us we can’t afford the America we believe in. And they paint a vision of our future that’s deeply pessimistic.
It’s a vision that says if our roads crumble and our bridges collapse, we can’t afford to fix them. If there are bright young Americans who have the drive and the will but not the money to go to college, we can’t afford to send them. Go to China and you’ll see businesses opening research labs and solar facilities. South Korean children are outpacing our kids in math and science. Brazil is investing billions in new infrastructure and can run half their cars not on high-priced gasoline, but biofuels. And yet, we are presented with a vision that says the United States of America – the greatest nation on Earth – can’t afford any of this.
Notably, the president didn’t utter the words “high-speed rail” in his speech. Perhaps he’s beginning to let go of the goal of providing 80 percent of Americans access to high-speed rail by 2035. Certainly this year’s budget, to be finalized this week, doesn’t bode well for sizable investments in rail.
Obama promised not to extend the Bush tax cuts, saying that he and others in his income bracket don’t really need any more help.
Friday is the official deadline for Congress to enact a budget resolution for next year, but considering they’re only just finishing up this year’s budget, don’t count on it.
Meanwhile, it’s in the context of this deeply ideological battle over social safety nets, tax rates, entitlement spending, and crumbling bridges that Congress is going to try to craft a surface transportation reauthorization bill. The two houses hope to have a bill ready by Memorial Day. Meanwhile, Obama said Vice President Joe Biden will start meeting next month with leaders of both parties to come to an agreement on a deficit reduction plan.