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Posted at 10:59 AM ET, 01/26/2011

From SOTU to the budget

By Jonathan Capehart

Reading the morning papers makes it pretty clear that while many folks thought President Obama delivered a fine speech, they were more than a little put out that he didn't get into specifics about how he would reduce the nation's monstrous deficit. Ross Douthat of the New York Times spreads that disappointment to Rep. Paul Ryan's response, arguing that the two men were engaged in the politics of evasion.

But what specific decisions are they evading? Today's Washington Post editorial lays it out in one stark paragraph:

The reality, as Mr. Obama understands, is that the country is headed for fiscal catastrophe unless it does some politically unpopular things: unwind the Bush tax cuts, including for the middle class; reduce projected Social Security benefits for future retirees, exempting the poor and disabled; rein in the cost of health care; limit popular income tax deductions.

No matter where you are on the economic ladder, one of those choices is bound to make you shiver. In fact, we should all be shivering because I don't see how the United States can close its $14 trillion debt without doing all of the aforementioned things in some form. So, get ready, folks. The sacrifice will be shared and the pain will be spread. Since he declined to do so last night, perhaps Obama will use the budget to outline just how much pain and how much sacrifice will be demanded of us. That's a big "perhaps," I know.

[Update, 1 p.m.: An acerbic yet eagle-eyed reader spotted an error in the original post. The national debt not the deficit is $14 trillion. This is now reflected in the text.]

By Jonathan Capehart  | January 26, 2011; 10:59 AM ET
Categories:  Capehart  | Tags:  Jonathan Capehart  
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Comments

First, Social Security contributes ZERO to the deficit (until Obama gave up 31% of employee taxes). What he is doing is avoiding the future deficits needed to repay the trust fund.

Second, Medicare/Medicaid uses over $200 billion (deficit) to cover the prescription benefits (I thought Obamacare fixed that).

Third, the only remaining item is RAISED TAXES. Just what the economy needed.

Posted by: kitchendragon50 | January 26, 2011 1:07 PM | Report abuse

Capehart wrote: "perhaps Obama will use the budget to outline just how much pain and how much sacrifice will be demanded of us. That's a big "perhaps," I know."

Does the kool-aid taste that good, Capehart? Obama last night claimed that the stimulus & huge government spending of his first 2 years worked. He made the same proposals he has made before for even more government spending. He glossed over the work of the deficit commission as though they had not made any recommendations. Freezing spending with a $1.5 Trillion dollar deficit and no sign of significant revenue increases amounts to a continuing fiscal disaster. California & Illinois are bankrupt.

And the best Capehart can come up with is "PERHAPS".


Posted by: pilsener | January 26, 2011 1:21 PM | Report abuse

The Pelosi-Obama-Reid (POR) economy kicked in during the latter part of June 2007, when its Congressional architects — Nancy Pelosi, Barack Obama, and Harry Reid — decided that starving the economy of energy by refusing to allow more offshore drilling in the face of $4 gas prices was a winning political position. Pelosi claimed that because we couldn’t totally “drill our way out of this,” we shouldn’t increase drilling at all. Reid put an exclamation point on Pelosi’s stubbornness by insisting that fossil fuels are “making us sick.” Well, the only thing sickened by their policies was the US Economy.

FDR tried massive public works programs during the Depression. All he did is prolong it for seven years. Japan tried government stimulus for 10 years running in the 1990s. It only resulted in “the lost decade.”

What Barry and Harry should support is expanding the tax cut element of the stimulus plan to include ALL incomes, ditching almost all of the (alleged) “green investments,” opening up oil and gas exploration, and (eventually) watching energy royalty money pour in.

That's why Obama's Best Line was;

“Some folks want wind and solar. Others want nuclear, clean coal, and natural gas,” Obama said. “To meet this goal, we will need them all – and I urge Democrats and Republicans to work together to make it happen.”

*Drill*Baby*Drill*

Posted by: KaddafiDelendaEst | January 26, 2011 1:24 PM | Report abuse

The key point that Mr.Capehart correctly makes is that to address the national debt there needs to be shared sacrifice.First,the very wealthiest Americans who now control more of the natioanl wealth than the bottom 90% combined must pay significantly higher tax rates,the loophole that allows hedge fund managers to pay a lower tax rate than their secretaries must be eliminated,a small financial transfer tax should be imposed to pay down the debt and curb the Wall St casinos,the wars in Iraq and Afghanistan, which will end up costing the taxpayers at least two trillion dollars, must end-a special war tax should be imposed on all incomes to pay for these wars and to in some small way share in the sacrifice of our soldiers and their families,and the bloated and corrupt trillion dollar a year military/homeland security budget must be slashed-I hope both conservatives and progressives will support the Ron Paul/Barney Frank bill to cut the military budget by at least a trillion dollars over the next decade and kudos to Rand Paul for proposing to cut the giagantic homeland security budget. However,the No.1 priority of the Congress and the administration should be to get Americans back working,paying taxes, and buying the products busineses produce.Full employment will significantly decrease the debt.Then,we can phase back in Clinton era tax rates for the middle class,apply the Social Security tax to all incomes,and change the Medicare tax from a flat tax to a progressive tax.The era of huge tax cuts for the rich,bankrupting military budgets,and endless wars must end.Time to rebuild the US.

Posted by: johnbird1 | January 27, 2011 9:21 AM | Report abuse

The key point that Mr.Capehart correctly makes is that to address the national debt there needs to be shared sacrifice.First,the very wealthiest Americans who now control more of the natioanl wealth than the bottom 90% combined must pay significantly higher tax rates,the loophole that allows hedge fund managers to pay a lower tax rate than their secretaries must be eliminated,a small financial transfer tax should be imposed to pay down the debt and curb the Wall St casinos,the wars in Iraq and Afghanistan, which will end up costing the taxpayers at least two trillion dollars, must end-a special war tax should be imposed on all incomes to pay for these wars and to in some small way share in the sacrifice of our soldiers and their families,and the bloated and corrupt trillion dollar a year military/homeland security budget must be slashed-I hope both conservatives and progressives will support the Ron Paul/Barney Frank bill to cut the military budget by at least a trillion dollars over the next decade and kudos to Rand Paul for proposing to cut the giagantic homeland security budget. However,the No.1 priority of the Congress and the administration should be to get Americans back working,paying taxes, and buying the products busineses produce.Full employment will significantly decrease the debt.Then,we can phase back in Clinton era tax rates for the middle class,apply the Social Security tax to all incomes,and change the Medicare tax from a flat tax to a progressive tax.The era of huge tax cuts for the rich,bankrupting military budgets,and endless wars must end.Time to rebuild the US.

Posted by: johnbird1 | January 27, 2011 9:22 AM | Report abuse

I find some proposals to blend wishfulness with theory. If we as a country intend to do something about our employment situation and something about our treasury balance, we need to approach from the "windward" as one might say. That is, we need to get our facts clear and understand that doing things always costs money.

Not every dollar of public expenditure is purchasing a positive benefit for society. And not every dollar not spent will enhance the government's (our) bottom line in the longer term. Further, the longer we bicker, the more debt mounts and the fewer our realistic options become.

It seems some perceive virtually every problem as based in excessive spending. Reasonably, that same reason cannot be the cause of all undesired circumstances. While "liberals" have taken a lot of heat for being spendthrift with the public funds, recent years have not shown governments of either party to be more or less thrifty.

Or we could start taking seriously the challenges we face and, instead of dogmatically responding with "reduce taxes!" or "shrink government", reason out what it will take to meet these challenges. That is what we have thus far failed to do. I suppose that to point out the foot-dragging tactics undertaken by the Republican party over the past several years will only spark more accusations of partisanship. Yet recent history seems to support that when the Democratic President or Democrats in the Congress move to address any issue, a sharp hue and cry arises from the opposing side. When, in previous times, has any party leader entered the chambers announcing that the objective of his leadership is to ensure that the President is not re-elected? Is that not the most bitter of partisan positions? It seems so to me.

Posted by: Jazzman7 | January 28, 2011 10:07 AM | Report abuse

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