Well, the Obama deficit reduction plan is going nearly as well as the Afganistan Retreat Strategy, with the non-partisan Congressional Budget Office predicting yet another deficit exceeding $1 trillion.
The White House blames Republicans for refusing to raise taxes. EXCEPT . . . spending is at the highest level it’s been since World War II and Obama was supposed to be a post-partisan, God-like figure who could transcend politics and make Kumbaya the national anthem.
Besides, it’s no secret where the money is: entitlements. Obama has been unwilling for his entire term to do anything serious on this front.
Mr. Elmendorf warned that the primary driver of the deficit later this decade would be the cost of an aging U.S. population, particularly the rising costs of government health-care programs. For example, the CBO projected the government would spend $1.6 trillion on Social Security, Medicare, and Medicaid in 2012, 44% of the federal budget. In 2022, the government will spend $3.0 trillion on those programs, 54% of the federal budget.
Meanwhile, spending on TARP this year will cost $23 billion – compared to $37 billion in savings last year – because the stock prices of GM and AIG, in which the government still owns stakes, have declined.