Committee for a Responsible Federal Budget blasts the White House
"It is encouraging that the Administration identifies some areas for real savings. However, the total level of savings is far short of what is needed and too many heroic assumptions are used to achieve them," said Maya MacGuineas, president of the Committee for a Responsible Federal Budget. "This budget fails to meet the Administration's own fiscal target, it fails to tackle the largest problems areas of the budget, and it fails to bring the debt down to an acceptable level."
"While we can certainly appreciate the difficult political environment in which the budget is introduced, the glaring omission of any significant entitlement reforms and the excessive use of 'fill-in-the-blank' budgeting does not help to advance the conversation," said MacGuineas.
The interesting argument that CRFB makes -- and that I've been hearing from other budget wonks, too -- is that the underlying economic assumptions in the budget are substantially more optimistic than what the Congressional Budget Office is using, and that's part of how the administration gets deficits so low. "Under CBO’s 'current law' projections (those which allow for the expiration of the 2001/2003/2010 tax cuts and other measures) the deficit reaches 3.2 percent of GDP by the end of the decade and the debt reaches 77 percent. Under OMB’s current law projections, the deficit reaches 2 percent and the debt 70 percent. This alone has us concerned that CBO’s estimate of the President’s budget won’t be nearly as charitable as OMB’s – and reality might not be either." Here's the graph:
I'm not a macroeconomic forecaster, so I'll leave it to others to adjudicate this debate. But whose economic assumptions turn out to be right really matters.
Update: Here's the Center on Budget and Policy Priorities' take. They say the budget "does not go nearly far enough to keep the debt stabilized in later decades" but that criticism "ignores the fact that had the budget included a large array of specific proposals for longer-term deficit reduction — ranging from increased taxes to changes in Social Security — that likely would have made it harder, not easier, for the Administration and Congress to eventually reach bipartisan agreement on those matters."
| February 14, 2011; 1:50 PM ET
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