Obama budget slated for $3.8 trillion
By DAVID ROGERS | 2/13/12 11:15 AM EST
The White House rolled out its new $3.8 trillion budget Monday, promising major investments to spur a manufacturing revival in the U.S. while walking a fine line between the August debt accords and President Barack Obama’s fear that too much austerity now will spell trouble for the economy—and his own reelection chances in November.
From Justice to Defense and Homeland Security, as many as six cabinet level departments or agencies will see their budget shrink in compliance with the new appropriations caps. But Obama would also go outside the box by creating new mandatory spending initiatives costing tens of billions of dollars and for the first time, openly tap war savings to fund his domestic agenda.
Even as the budget documents were released Monday morning, the president was speaking at a northern Virginia campus, announcing a new $8 billion plan to help community colleges partner with industry as training centers for a new generation of skilled workers. Within the Energy Department, a new $6 billion HomeStar rebate proposal would reward homeowners who retrofit their property. And elsewhere the budget includes a pair of $1 billion commitments to promote advanced electrical vehicles and developing a network of manufacturing innovation institutes.
From Justice to Defense and Homeland Security, as many as six cabinet level departments or agencies will see their budget shrink in compliance with the new appropriations caps. But Obama would also go outside the box by creating new mandatory spending initiatives costing tens of billions of dollars and for the first time, openly tap war savings to fund his domestic agenda.
Even as the budget documents were released Monday morning, the president was speaking at a northern Virginia campus, announcing a new $8 billion plan to help community colleges partner with industry as training centers for a new generation of skilled workers. Within the Energy Department, a new $6 billion HomeStar rebate proposal would reward homeowners who retrofit their property. And elsewhere the budget includes a pair of $1 billion commitments to promote advanced electrical vehicles and developing a network of manufacturing innovation institutes.
The bottom line is a fourth straight year of $1 trillion-plus deficits and only marginal improvement in 2013 when the shortfall will narrow to $901 billion—still a far cry from what the president had promised when he took office in 2009.
Indeed, even if Obama were to win a second term and prevail on his entire tax agenda, the budget tables show that the deficit won’t fall back below 3 percent of GDP until 2018—after he will have left the White House.
That said, this is a budget plainly constructed to light a spark after all the economic troubles of recent years, fleshing out a political narrative which Obama hopes will inspire even as his critics despair of the debt being accumulated by Washington. “It’s morning again in America,” was Ronald Reagan’s pitch seeking a second term after hard times in the 1980’s. Obama leapfrogs back to the post-World War II era, evoking the glory years of American manufacturing and a period when the GI bill embodied a confidence in education and shared sense of opportunity to move up economically.
“America was built on the idea that anyone who is willing to work hard and play by the rules, can make if they try—no matter where they started out,” Obama says, in his opening budget message to Congress. “But for many Americans (today), the basic bargain at the heart of the American Dream has eroded.”
Read more: http://www.politico.com/news/stories/0212/72792.html#ixzz4Od3Ft7HO
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