March 4, 2014
By Stephen Moore
Barack Obama keeps saying there isn't a government program for every problem in America, but you wouldn't know it from reading his new 2015 federal budget.
This nearly $4 trillion document would spend more federal dollars on everything from climate change to green energy to transit systems to welfare state expansion to federal land purchases to day-care subsidies.
The spending blueprint is a back-door scheme to bust the budget caps that already were raised just last December.
It calls for spending $56 billion above those caps, to be paid for by "loophole closing" tax increases to pry more money from businesses and investors. This is a violation of the budget rules Obama agreed to.
And even if the tax loopholes deserve to be closed, the money should be used for a broad reform of the tax code and lower tax rates, as Ways and Means Committee Chairman Dave Camp of Michigan called for last week, not as a toll to finance bigger government.
The theme of this budget is "an end to austerity," which is an almost laughable claim given the first-term spending blitz under Obama and the $5 trillion glommed on to the national debt.
As in recent years, this budget camouflages domestic program hikes, partly by pairing them with major reductions in the military budget.
Deficit reduction in recent years has come almost exclusively from reductions in troop levels and military operations in Afghanistan and Iraq.
The defense budget is down nearly $100 billion since 2011 and further cuts are on the way this year.
But instead of using those savings to start eliminating an expected half-trillion-dollar deficit, the White House wants to spend $302 billion over four years, including a new infrastructure bank, to finance transportation projects.
Democrats continue to claim that infrastructure spending has been underfunded in recent years, but the budget reality is quite at odds with that assessment.
According to St. Louis Federal Reserve data on highway and road expenditures, public spending rose from $58 billion in 2003 to $74 billion in 2013 — a 46% hike over the past decade (not adjusted for inflation).
Overall public construction spending rose by more than 25% over that 2003-13 period to $267 billion.
These programs aren't being pinched of pennies. And by the way, the cost of federal construction projects might be cut by 10% to 20% — meaning more repaired bridges and more covered potholes — if it were not for federal Davis-Bacon laws requiring de facto union wages paid on all federal construction projects.
Food Stamp Binge
House Budget Committee Chairman Paul Ryan reminds us that, for all the talk of spending austerity, the budgets of most domestic agencies and bureaus rose by more than 30%-40% in Obama's first two years of stimulus programs, when $800 billion got passed around.
There are no major entitlement savings in this budget — in fact, there are expansions.
The welfare state has already expanded to new heights under Obama with record enrollments in Medicaid, unemployment insurance, food stamps and disability. One in seven families is now collecting food stamps.
The White House is seeking to enroll almost 6 million more Americans in the earned income tax credit program, at a cost of $60 billion.
The Earned Income Tax Credit is a cash subsidy to working poor families. Obama is not suggesting this as a replacement for existing programs, but in addition to the $1 trillion a year and counting diverted to the welfare state.
We have here on display Obama's vision of liberal governance — a government that will solve every societal problem from obesity to rising sea levels.
It's a budget that should be dead on arrival, but if by chance it still has a heartbeat, sign it up for ObamaCare. That would be a deserving death sentence.
- Stephen Moore is chief economist at the Heritage Foundation
Originally appeared in Investor's Business Daily
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