Events Designed To Prepare Nation For Budget Plan
Friday, February 20, 2009
When President Obama rolls out his first budget proposal next week, it will contain some of the ugliest deficit numbers this nation has seen since the end of World War II. So the Obama administration is planning an entire week of budget-focused activities to prepare the country for the painful spending cuts and program changes that will be needed to begin reducing the red ink.
The schedule kicks off Monday with a White House summit on fiscal responsibility, where Obama will pledge to bring federal spending and tax collections back into balance after a spending spree on the economic crisis.
The summit will bring leading Democratic and Republican lawmakers from both chambers of Congress together with experts on taxes, health care, Social Security and the budget process in what administration officials are calling an initial conversation about long-term budget reform.
On Tuesday, Obama will lay out the severity of the nation's economic crisis in a speech to a joint session of Congress.
And on Thursday, the president will deliver his budget plan to lawmakers.
Usually, the White House is required to submit its budget request to Congress on the first Tuesday in February, but new presidents are granted a little slack. Even with the extra three weeks, the administration is not prepared to submit a full budget, complete with the thick volumes of appendices and historical tables familiar to budget aficionados.
Those details will come this spring. Instead, the first submission will be a budget outline: a framework that establishes the president's spending priorities and offers broad funding levels for each of the federal agencies. The document will also forecast how much the president expects the government to spend overall during each of the next 10 years, how much he expects the Treasury to collect in tax revenue and how big a gap he anticipates between expenditures and revenue.
In his last few budgets, President George W. Bush offered those numbers only five years into the future, and his budget experts strained mightily to show a path toward balance. Because of the current economic crisis -- and the nearly $2 trillion the government has committed to address it -- Obama has little hope of erasing the deficit, even using a 10-year window, budget analysts said.
In a report released yesterday by the Brookings Institution, authors Alan Auerbach and William Gale predicted that, even under optimistic assumptions, the deficit will "average at least $1 trillion per year for the 10 years after 2009, even if the economy returns to full employment and the stimulus package is allowed to expire in two years."
That could make it much tougher for the president to make good on some of his most significant -- and expensive -- campaign promises, such as expanding health-care coverage for the uninsured and cutting taxes for the middle class. And it could make it more difficult for the Democrats who control Congress to muster the votes to approve Obama's budget.