Tags: Walker | Obama | Budget | Entitlement

Former Comptroller General Walker: Obama Budget Ignores Entitlement Reforms

Tuesday, 14 February 2012 07:42 AM

President Barack Obama's $3.8 trillion budget delivered to Congress does little to address reforming entitlement programs and uses accounting gimmicks to illustrate savings that aren't really there, says David M. Walker, former U.S. Comptroller General and current CEO of the Comeback America Initiative.

"The President's budget fails to lay out a substantive path to restore fiscal sanity. It does not include enough specifics regarding comprehensive tax reform and neglects any reforms to Social Security. It is not bold enough or specific enough regarding proposed changes to Medicare, Medicaid and other health reforms," Walker says in remarks emailed to Moneynews.

"The proposed budget would greatly increase the portion of government spending that is on 'auto-pilot.' While the president’s budget cuts discretionary spending programs by 1 percent over a 10-year period, mandatory spending programs and interest on debt grow by more than 96 percent over the same decade. The result is that in the year 2022 more than 78 percent of total outlays will be on auto-pilot — which is both irresponsible and unsustainable."

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The budget also relies on accounting "gimmicks" to produce illusions of savings.

"An example of this is counting a reduction in spending for overseas military operations as savings, and using it to partially offset new transportation spending," Walker says.

"Moreover, the transportation spending is moved from discretionary to mandatory, so it is not subject to discretionary spending caps."

In February of 2009, Obama pledged to cut the deficit he inherited in half.

"And that's why today I'm pledging to cut the deficit we inherited in half by the end of my first term in office. This will not be easy. It will require us to make difficult decisions and face challenges we've long neglected. But I refuse to leave our children with a debt that they cannot repay — and that means taking responsibility right now, in this administration, for getting our spending under control," the president said three years ago.

According to President Obama back in 2009, he inherited a $1.3 trillion deficit, meaning he was supposed to shave $650 billion off by fiscal year 2013.

The deficit still stands at over $1 trillion.

White House Chief of Staff Jacob Lew says now is not the time to cut spending.

"I think there is pretty broad agreement that the time for austerity is not today," Lew said during a series of appearances on Sunday talk shows, the Associated Press reports.

"Right now we have an economy that's taking root ... austerity measures right now would take the economy in the wrong way."

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