I Don’t Know Why Paul Ryan Gets So Much Grief Over His Budget Plan

by Pejman Yousefzadeh on April 10, 2011

As far as I am concerned, opprobrium should be directed to the other end of Pennsylvania Avenue:

U.S. President Barack Obama pledged on Monday to halve a record 2010 budget deficit by the end of his first term in office, but made tackling double-digit unemployment his immediate priority with a spending plan that risked public ire and a rough battle in Congress.

[. . .]

“We won’t be able to bring down this deficit overnight, given that the recovery is still taking hold,” Obama said after laying out $3.8 trillion in spending plans for the fiscal year to Sept. 30, 2011.

“We will continue, for example, to do what it takes to create jobs. That is reflected in my budget. It is essential,” he said in a televised statement from the White House.

[. . .]

The budget forecast a $1.56 trillion deficit in 2010, or 10.6 percent of gross domestic product (GDP), up from a 9.9 percent share of GDP in 2009.

But the shortfall was forecast to shrink to 8.3 percent of GDP in 2011. By the time his term ends in January 2013, it would have halved from the level Obama inherited on taking office last year, keeping a key pledge. That supposes Obama gets Congress to agree to spending cuts and that the economy rebounds strongly enough to sharply lift tax revenues.

Even if all goes to plan, the budget still forecasts U.S. public debt rising above 71 percent of GDP by 2013, up from 53 percent in 2009, and almost 80 percent by 2020 — levels that could spook investors.

[. . .]

“We’re playing with fire. Foreign countries are noticing our governance failures,” said Bill Galston, a senior fellow at the Brookings Institution, a Washington think-tank.

“The dollar’s standing as the world’s reserve currency and our economy’s standing as the world’s leader are both in jeopardy,” he said.

If those numbers don’t scare you, then qualified medical personnel should check to see if you are still alive.

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