How's Your Stimulus?

But martaug, at the time Obama took office, the national debt was ALREADY almost $11 trillion. I don't even agree with the starting figure that article is using (which is $7 trillion). Doubling $7 trillion is obviously different than doubling $11 trillion. I also don't recall you being so vehement again Bush running up the deficit all these years - but that's a point for another thread.

Here's what I don't get about the source: The President's Budget does not dictate funding out to 10 years. There is no guarantee that Obama will be President 5 years from now, and it is certain he won't still be president 10 years from now. So it appears that what the CBO is stating is that the debt will about triple in 10 years regardless of who the president is, and what party that president is from. In other words, there are sunk costs in the budget that exist independent of who the president is.

This seems absurd to me. That tripling of the debt is the same, regardless of whether or not Obama wins re-election, or whether there is democrat or repbublican administration in 2012 and 2016? It would certainly appear that the presidential administrations of 2012 and 2016 would have some impact on the deficit in 2019? Apparantly, if the CBO is to be believed, the impact is a lot less than one would believe? (In fact, if it is to be believed, the impact is negligible?)

 

Aldeth, as I understand it, the President's Budget does not dictate spending period. Congress determines spending, not the president, right? That being said, though, the President has a lot of sway, and long-term plans generally seem to be stuck to, even when there's a change mid-way. On those notes, I believe it's about as reasonable to saddle Obama with the next 10 years of budget as it is to saddle him with any budget at all (as opposed to saddling Congress, which definitely still bears a large portion of the burden).

 

Technically, the President's Budget (PB) doesn't dictate anything until it is approved by Congress. But it does cover a specific period - 5 years. I work with this stuff all the time, and most funding projections cover 5 years. This year's PB will cover fiscal years 2010-2014. (And Congress is only approving the money for this fiscal year - the other years are estimates and are not approved this far in advance.) Then, this summer, there is a process where all major government programs make budget requests for upcoming fiscal years. The document is called the Budget Estimate Submission. I work on that document too. Since the budget is typically approved for the following fiscal year by the time the BES is released, the BES is making a request for the next PB, and thus the one we produce this summer will be for fiscal years 2011-2015.

Long term plans are generally not stuck to - especially when you change parties as well as administrations. Look at what is happening right now, and what happened in 2001 and 1993 as other examples. That's why the PB and BES are submitted annually.

I understand that the government has to plan ahead, and most money is obligated to different programs early in the fiscal year. Because of this, when you get a new administration, there is some lag time for the incoming administration to get their funding priorities in order. Obama is currently working on the FY2010 budget. Since most of the FY2009 money has already been obligated to different programs (even though most of it hasn't been spent yet), there is little point in Obama trying to adjust the FY2009 Bush budget. Similarly, when Obama leaves office (regardless of whether it is January of 2013 or 2017) his budget for that FY will stay in effect. No president ever controls the budget for 10 years as you suggest. It's the same number of years he's on office: typically either 4 or 8. All presidents have little control over the budget the year they take office, but have significant control the year after they leave.

 

Actually, I just did some research, and I discovered that a typical PB only delineates money for 2 years, although it will detail out projected estimates for 5 years.

However, there is an exception. When a new administration comes in, the PB is only for one fiscal year. So Obama's budget, expected to be released in early May, will only be for FY2010. (I should have remembered this from when Bush took office in 2001.)