The Budget

Obama's $3.9 Trillion Campaign Ad


Government Printing Office staff members arrange copies of President Barack Obama's Fiscal Year 2015 Budget at the GPO bookstore in Washington on March 4

Photograph by Andrew Harrer/Bloomberg

Government Printing Office staff members arrange copies of President Barack Obama's Fiscal Year 2015 Budget at the GPO bookstore in Washington on March 4

On Tuesday morning, the White House unveiled its $3.9 trillion budget for fiscal year 2015. While many of the details were new, the overall thrust of the budget became apparent two week ago, when news leaked that President Obama would not be including a proposal to cut Social Security cost-of-living benefits (by switching to the so-called chained Consumer Price Index) as he had in previous budgets. This was taken as a signal that the White House had given up hope of trying to reach a “grand bargain” with Republicans to cut the deficit and entitlement programs.

In past budgets, offering Social Security cuts had been Obama’s way of expressing his desire and willingness to tackle the deficit, which Republicans were always griping about. Obama’s preemptive negotiating style of offering up chained CPI as a concession drove liberals nuts, but they needn’t have worried: Republicans never took up Obama’s offer. And after more false starts than the Oakland Raiders’ offense, the prospects of the two parties reaching a grand bargain are finally dead and buried.

This year Obama’s budget has a different purpose. That purpose isn’t, as you might expect, to get passed into law—there’s no chance of that happening while Republicans control the House of Representatives. Lest there be any doubt, Washington Senator Patty Murray, the top Senate Democrat, said she would not introduce a budget resolution this year and would instead defer to the two-year framework she negotiated with Republican House Budget Committee Chairman Paul Ryan of Wisconsin.

Instead, Obama’s budget is an expression of current Democratic values meant to shape the political debate ahead of November’s elections. The budget calls for $651 billion in new revenue from the wealthy. It would impose the “Buffett Rule” that rich people must pay at least 30 percent of their income in taxes. It would hit banks with a $56 billion in “financial crisis responsibility fees.” In addition, it would fund a litany of popular liberal programs. Obamacare would, of course, be fully funded and in fact expanded to the tune of $14.6 billion to pay for more primary care providers. The budget would also fund universal pre-kindergarten, as Obama called for in the State of the Union Address, and it would expand the earned income tax credit for the working poor by $60 billion over 10 years.

Along with Obama’s calls to raise the minimum wage, this is largely an effort to steer the national dialogue in a more favorable direction for Democrats, whose numbers have suffered since the botched rollout of the Obamacare federal exchanges last fall.

Not surprisingly, Republicans didn’t take kindly to the White House proposal. “This budget isn’t a serious document; it’s a campaign brochure,” Ryan said. “This budget is a clear sign this president has given up on any efforts to address our serious fiscal challenges that are undermining the future of our kids and grandkids,” griped House Speaker John Boehner of Ohio.

While any honest assessment would note that Republicans have also given up on negotiating, what Boehner and Ryan said is absolutely correct.

Green_190
Green is senior national correspondent for Bloomberg Businessweek in Washington. Follow him on Twitter @JoshuaGreen.

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