White House threatens veto of Cut, Cap, and Balance bill

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With the House poised to vote on a debt-ceiling increase tomorrow, the White House has released a threat to veto the bill if it reaches the President’s desk.  This statement was just released by e-mail, emphasis in the original:

The Administration strongly opposes H.R. 2560, the “Cut, Cap and Balance Act of 2011.”  Neither setting arbitrary spending levels nor amending the Constitution is necessary to restore fiscal responsibility.  Increasing the Federal debt limit, which is needed to avoid a Federal government default on its obligations and a severe blow to the economy, should not be conditioned on taking these actions.  Instead of pursuing an empty political statement and unrealistic policy goals, it is necessary to move beyond politics as usual and find bipartisan common ground.

The bill would undercut the Federal Government’s ability to meet its core commitments to seniors, middle-class families and the most vulnerable, while reducing our ability to invest in our future.  H. R. 2560 would set unrealistic spending caps that could result in significant cuts to education, research and development, and other programs critical to growing our economy and winning the future.  It could also lead to severe cuts in Medicare and Social Security, which are growing to accommodate the retirement of the baby boomers, and put at risk the retirement security for tens of millions of Americans.

Furthermore, H. R. 2560 could require even deeper cuts, since it conditions an increase in the Federal debt limit on Congressional passage of a Balanced Budget Amendment.  H. R. 2560 sets out a false and unacceptable choice between the Federal Government defaulting on its obligations now or, alternatively, passing a Balanced Budget Amendment that, in the years ahead, will likely leave the Nation unable to meet its core commitment of ensuring dignity in retirement.

The President has proposed a comprehensive and balanced framework that ensures we live within our means and reduces the deficit by $4 trillion, while supporting economic growth and long-term job creation, protecting critical investments, and meeting the commitments made to provide economic security to Americans no matter their circumstances.  H.R. 2560 is inconsistent with this responsible framework to restore fiscal responsibility and is not an appropriate method of reducing the Nation’s deficits and debt.  The Administration is committed to working with the Congress on a bipartisan basis to achieve real solutions.

If the President were presented this bill for signature, he would veto it.

A few points seem remarkable here.  Is it really Barack Obama’s contention that a balanced budget, now or in the future, threatens the dignity of retirees?  What basis does he have for claiming that deficits are a necessary component of retiree dignity?  That sounds very much like a demand for eternal deficit spending, with no attempt at any discipline whatsoever.

As far as Obama’s “comprehensive and balanced framework,” CNS News reminds us that the only specific plan Obama has published actually increases deficit spending rather than decrease it:

While the Republican-controlled House of Representatives has voted this year to approve House Budget Chairman Paul Ryan’s (R.-Wis.) proposal–that would put the government on a gradual path to a surplus by 2040–and plans to vote on a balanced budget amendment next week that would cap federal spending at 18 percent of GDP, the only budget proposal President Obama’s has publicly revealed in 2011 would, according to the Congressional Budget Office, increase the deficit by $26 billion this year, $83 billion next year, and $2.7 trillion over the next decade.

Additionally, although annual budget deficits would decline somewhat between 2013 and 2015 under Obama’s proposal, according to the CBO, after that they would start increasing again, going up every year from 2016 to 2021, the last year estimated by the CBO.

In short, the only budget proposal Obama has put forward this year for the public to review and analyze puts the federal government on a path to eventual bankruptcy.

The CBO report from April can be found here.  This chart shows that Obama’s projected budget produces bigger deficits by percentage of GDP than anything seen since 1981 — with the exceptions of the Democratic budgets to 2008-11.  They’re worse than the baseline we’re on at the moment, and not coincidentally, they make the debt load appreciably worse as a result:

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Obama blasted some of the cuts Republicans have suggested, saying the proposal would “undercut the federal government’s ability to meet its core commitments to seniors, middle-class families and the most vulnerable, while reducing our ability to invest in our future.

UMMMmmmmmmmmmmm………..

Correct me if I’m wrong but don’t all of the numbers stories say the same thing?
That we have ~$200 BILLION in monthly income and only $25 billion in debt payments, leaving plenty enough to completely cover the COMMITMENTS we now have toward our seniors, middle class and most vulnerable?
I WILL agree that our ”ability to ”invest” in the future” might be impaired….but times are tough!
What was the top tax bracket under Bush?
38%?
It will be 70% under Obama if he is re-elected AND all of his ObamaCare tax raises happen on schedule!
Add to that Obama wants ”the rich” to pay MORE!
Obama singing the Beatles TAXMAN.

@Nan G:

Not to mention that currently, all government revenues from current workers towards SS(and including the interest on the bond “iou’s” in the trust fund) and Medicare, on a monthly basis, exceed the monthly payouts for those programs. Threatening to discontinue checks to seniors and payments for Medicare, when the money for those programs, from current workers, is still rolling in, is playing politics, and shows the commitment(or lack of it) by the liberal/progressives towards those programs.

U.S. Senate Republican Leader Mitch McConnell made the following statement on the Senate floor Monday regarding Cut, Cap and Balance:

This is a pivotal week for America.

Two years of reckless spending and debt have brought us to the point of crisis. And this week, Americans will see how their elected representatives decide to resolve it.

On the one side are those who believe that failing to rein in spending now could be calamitous, and that a government which borrows 42 cents for every dollar it spends needs to sober up. Washington needs strong medicine to heal its spending addiction now, not a false promise of it later.

And on the other side are those who want to pretend the status quo is acceptable — that everything will be fine if we freeze current habits in place, raise job-killing taxes on small businesses, and do nothing about the long term fiscal imbalance that imperils our economy.

“Republicans have tried to persuade the President of the need for a course correction, but weeks of negotiations have shown that his commitment to big government is simply too great to lead to the kind of long-term reforms we need to put us on a path to balance and economic growth.

So we’ve decided to bring our case to the American people.

And that’s why this week, Republicans in the House and the Senate will push for legislation that would cut government spending now, cap it in the future, and which only raises the debt limit if it’s accompanied by a constitutional amendment to balance the federal budget.

The Cut, Cap, and Balance plan is the kind of strong medicine Washington needs and the American people want — and Republicans in both houses of Congress will be pushing it aggressively this week.

I heard one of my Democratic colleagues say yesterday that the votes simply don’t exist to pass any bill in the Senate that balances the budget.

My question is, why in the world not?

If you can’t vote for a bill that says you’ll live within your means, then you’ve given up and you agree that the unsustainable path is the only one we have. And that’s completely unacceptable.

Every single Republican in the Senate supports a Balanced Budget Amendment.

All we need is 20 Democrats to join us. And by my count, at least 23 of them have led their constituents to believe they’d fight for it.

So my message to Senate Democrats this week is this: I would suggest you think long and hard about whether you’ll vote for the Cut, Cap, and Balance legislation that the House is taking up tomorrow.

Not only is this legislation just the kind of thing Washington needs right now, it may be the only option we have if you want to see the debt limit raised at all.

The White House has called for a `balanced approach’ in this debate.

Well, a bill that actually balances our books is coming to the Senate floor this week.

I strongly urge my Democratic friends to join us in supporting it.

Some have said they think this bill goes too far. With all due respect, I think most Americans believe Congress and this White House have gone too far in creating the fiscal mess we’re in.

It’s time for real action. It’s time to show the American people where we stand. It’s time to balance the books.”

http://thehill.com/blogs/congress-blog/economy-a-budget/172041-time-to-cut-cap-and-balance-the-books

Yes, Obama has vowed to veto this bill if it ever reaches his desk.

And next year, America will vote to Veto Obama.