$4 Trillion
When leftists start arguing about how much laissez-faire capitalism we experienced under the Bush adminstration, I often point out that he was the first President to preside over a $2T budget, and he was also the first to propose a $3T budget (for FY’09).
I expected Obama to spend more than Bush — but I didn’t think it would be this bad:
Details on president Barack Obama’s first budget are out today, and there is no shortage of eye-popping numbers. Total budgeted spending in fiscal 2009 (which began five months ago) will reach nearly $4 trillion, or nearly 30% of American GDP. The deficit for the year is expected to be about $1.75 trillion. As budgeted, the deficit will decline to just over $1.1 trillion in fiscal 2010, and to about $500 billion by the end of Mr Obama’s first term—close to, but still above, last year’s deficit of $459 billion. The drop is less ambitious than it sounds, however; it is primarily due to a winding down of spending in Iraq and the expiration of Bush era tax cuts. It will take harder choices to move the budget toward balance.
You can play around with the numbers a bit; i.e. the 2010 budget itself is somewhere between $3.5T and $4T, but when you include $750B in “room” for a bank bailout that we “might” need — and it’s not clear whether that’s FY’09 or FY’10 — I think you can see that planned spending is likely to top that $4T mark. Likewise, in Obama’s defense, if he’s actually living up to his promise of taking the “off-budget” spending of the Bush administration and putting it on-budget, that might not be as big of an increase as it looks.
But it’s still big. It’s still a number that should scare the hell out of most Americans. It places federal government spending at roughly a third of GDP — which doesn’t include state and local spending, of course. We’re going to be nearing a point where government, all levels combined, spend half of GDP. If anyone believed we had a true free market before, I’m sure they’ll change their minds.
And his deficit reductions [of the deficits he’s creating]? Well, it’s a combination of tax hikes, reduction in Iraq spending, and an assumption of 4% GDP growth rates. I guess it’s because he’s figuring in the Keynesian multiplier effect of all his wonderful proposals, huh?
Oh, in completely unrelated news, 2008 was the biggest year on record for lobbyists — and 2009 is expected to be bigger:
So the $3.2 billion bonanza for lobbyists in 2008 was just a precursor of the lollapalooza to come. Within three weeks of Obama’s inauguration, the Washington Post reported that more than 90 organizations had hired lobbyists specifically to influence the stimulus bill.
Hmm, a link between ever-increasing budgets and your friendly K-Street fellows trying to influence how that money is being spent? By “most open and transparent administration in history”, is Obama just suggesting that the “Open for Business” sign will be displayed prominently in the window of the White House? I’m sure it doesn’t mean that he’s installing a “No Solicitors” sign.
