Obama on Solid Track to Top Bush’s Deficits

posted by Nima

July 14, 2009 · Posted in Government 

The AP reports Budget deficit tops $1 trillion for first time:

The deficit of $1.09 trillion so far this year compares to an imbalance of $285.85 billion through the same period a year ago. The deficit for the 2008 budget year, which ended Sept. 30, was $454.8 billion, the current record in dollar terms.

Revenues so far this year total $1.59 trillion, down 17.9 percent from a year ago, reflecting higher unemployment, which cuts into payroll taxes and corporate tax receipts.

Under the administration’s budget estimates, the $1.84 trillion deficit for this year will be followed by a $1.26 trillion deficit in 2010, and will never dip below $500 billion over the next decade. The administration estimates the deficits will total $7.1 trillion from 2010 to 2019.

Just to get an idea of how reliable these government estimates are: Please note that not too long ago, in its 2009 budget document, the government said that it was expecting a deficit of $611 billion for 2009, and $300 billion and lower for the years to come.

I noted back then that these numbers are way off and in February proposed the following figures:

Now that we have updated figures on coming expenses it’s time to update the deficit predictions:

  • $1.65 trillion for 2009
  • $1.6 trillion for 2010
  • $1.95 trillion for 2011
  • $2.2 trillion for 2012

As you can see, now my 2009 figure is optimistic already. I expect same will apply to the following years. I also said in that same post:

If President Obama keeps spending like this, and really wants to cut the deficit in half by 2013, he will at one point be faced with no other choice but to raise taxes on all Americans, rich, middle class, and poor. This is of course nothing new. Taxes have been rising in the US for the past century.

Back then there was no talk about those kinds of taxes. Since then through now we have heard more and more such proposals.

A national sales tax:

With budget deficits soaring and President Obama pushing a trillion-dollar-plus expansion of health coverage, some Washington policymakers are taking a fresh look at a money-making idea long considered politically taboo: a national sales tax.

Taxes on health benefits:

An effort by Senator Max Baucus of Montana to develop compromise health care legislation has come under sharp assault by fellow Democrats who have urged him to abandon a plan to help pay for the bill by taxing some employer-provided health benefits.

A tax on generous employer-provided health plans is favored by Republicans and several centrist Democrats. But opinion polls show the idea to be generally unpopular, and several senators up for re-election in 2010, including the majority leader, Senator Harry Reid of Nevada, have said they oppose it.

Health tax for high income earners:

Democratic lawmakers in the U.S. House of Representatives want to increase taxes on the highest- earning American families to help pay for an overhaul of the nation’s health-care system.

Legislation to be unveiled on July 13 would raise $540 billion over the next decade by setting a 1 percent surtax on couples with more than $350,000 in annual income, said Representative Charles Rangel, chairman of the tax-writing Ways and Means Committee. Higher rates would take effect for those earning $500,000 and $1 million, Rangel said.

… we shall see how many more ways and suggestions to loot and tax the people into oblivion they will come up with over the following months.

Meanwhile, contact your representatives. Tell them your opinon. Tell them you will do everything in your power to vote them out of office in 2010 if they vote for any more boondoggles.

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