Obama's Budget Projects $1.75 Trillion Deficit (Catch-all for Budget Threads)

[Wretched Excess]

Obama's Budget Projects $1.75 Trillion Deficit

President Barack Obama is sending Congress a budget Thursday that projects the government's deficit for this year will soar to $1.75 trillion, reflecting efforts to pull the nation out of a deep recession and a severe financial crisis.

Obama's budget overview will call for nearly $4 trillion in spending in fiscal year 2010 and creates space for up to $750 billion in additional bank bailout funds this year - money that hasn't been requested and the administration hopes will not be necessary to stabilize the still-reeling financial system.

Senior administration officials would not disclose a precise figure for the entire budget, but said it would likely fall between $3.8 trillion and $4 billion for the fiscal year beginning Oct. 1. The White House will formally release its budget overview at 11 a.m. Thursday.

The president's budget will also set aside a $634 billion "reserve fund" as a down payment to cover roughly two-thirds of the anticipated 10-year cost of universal health care coverage -- projected at $1 trillion.

$4 billion to $3.8 trillion.  That's quite a large range for a budget that is set to be published today. I'm still amazed that people actually voted for this idiot.

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[NHSparky]

Dow 5000, here we come.

[Wretched Excess]

President Obama's fiscal 2010 budget calls for $3.55 trillion in spending and creates space for up to $750 billion in additional bank bailout funds.

President Obama on Thursday unveiled a $3.55 trillion budget for next year, a spending plan that sets aside billions for health care and the ailing financial industry and drives up the federal deficit to record levels.

The president, who gave an overview of the fiscal 2010 budget Thursday morning, said he is beginning the long-term task of restoring fiscal discipline despite massive deficit spending he claims is necessary to kick-start the economy.

"There are some hard choices that lie ahead," Obama said. "We're going to go through our books, page-by-page, line-by-line to eliminate waste and inefficiency."

He said his administration has already identified $2 trillion in reductions over the long-term.

But he said "we must add to our deficits in the short-term to provide immediate relief to families and get our economy moving."

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[thundley4]

Before he spoke the DJIA was up almost 150, now only 95. Plenty of time to go negative again today. 

[BlueStateSaint]

Before he spoke the DJIA was up almost 150, now only 95. Plenty of time to go negative again today. 

And it probably will.

FEBRUARY 26, 2009, 3:47 A.M. ET

The 2% Illusion
 
Take everything they earn, and it still won't be enough


President Obama has laid out the most ambitious and expensive domestic agenda since LBJ, and now all he has to do is figure out how to pay for it. On Tuesday, he left the impression that we need merely end "tax breaks for the wealthiest 2% of Americans," and he promised that households earning less than $250,000 won't see their taxes increased by "one single dime."

This is going to be some trick. Even the most basic inspection of the IRS income tax statistics shows that raising taxes on the salaries, dividends and capital gains of those making more than $250,000 can't possibly raise enough revenue to fund Mr. Obama's new spending ambitions.

Consider the IRS data for 2006, the most recent year that such tax data are available and a good year for the economy and "the wealthiest 2%." Roughly 3.8 million filers had adjusted gross incomes above $200,000 in 2006. (That's about 7% of all returns; the data aren't broken down at the $250,000 point.) These people paid about $522 billion in income taxes, or roughly 62% of all federal individual income receipts. The richest 1% -- about 1.65 million filers making above $388,806 -- paid some $408 billion, or 39.9% of all income tax revenues, while earning about 22% of all reported U.S. income.

Note that federal income taxes are already "progressive" with a 35% top marginal rate, and that Mr. Obama is (so far) proposing to raise it only to 39.6%, plus another two percentage points in hidden deduction phase-outs. He'd also raise capital gains and dividend rates, but those both yield far less revenue than the income tax. These combined increases won't come close to raising the hundreds of billions of dollars in revenue that Mr. Obama is going to need.

But let's not stop at a 42% top rate; as a thought experiment, let's go all the way. A tax policy that confiscated 100% of the taxable income of everyone in America earning over $500,000 in 2006 would only have given Congress an extra $1.3 trillion in revenue. That's less than half the 2006 federal budget of $2.7 trillion and looks tiny compared to the more than $4 trillion Congress will spend in fiscal 2010. Even taking every taxable "dime" of everyone earning more than $75,000 in 2006 would have barely yielded enough to cover that $4 trillion.

Hopey McChangeSnorter strikes!

http://online.wsj.com/article/SB123561551065378405.html?mod=djemEditorialPage

[Wretched Excess]

just think about how bad it would be if he hadn't hosted the "Financial Responsibility Summit".   we'd be totally hosed.

[Chris_]

Dow 5000, here we come.

I knew Oooooobama would trash the economy.  I just didn' think he'd be this efficient at it.

[Chris_]

Obama's Budget: Almost $1 Trillion in New Taxes Over Next 10 yrs, Starting 2011

President Obama's budget proposes $989 billion in new taxes over the course of the next 10 years, starting fiscal year 2011, most of which are tax increases on individuals.

1) On people making more than $250,000.

$338 billion - Bush tax cuts expire
$179 billlion - eliminate itemized deduction
$118 billion - capital gains tax hike

Total: $636 billion/10 years

2) Businesses:

$17 billion - Reinstate Superfund taxes
$24 billion - tax carried-interest as income
$5 billion - codify "economic substance doctrine"
$61 billion - repeal LIFO
$210 billion - international enforcement, reform deferral, other tax reform
$4 billion - information reporting for rental payments
$5.3 billion - excise tax on Gulf of Mexico oil and gas
$3.4 billion - repeal expensing of tangible drilling costs
$62 million - repeal deduction for tertiary injectants
$49 million - repeal passive loss exception for working interests in oil and natural gas properties
$13 billion - repeal manufacturing tax deduction for oil and natural gas companies
$1 billion - increase to 7 years geological and geophysical amortization period for independent producers
$882 million - eliminate advanced earned income tax credit

Total: $353 billion/10 years

LINK

Expect double digit inflation to begin shortly.   

[Wretched Excess]

remember the $2 trillion in savings that he had found by "going line by line through the budget"?  it's bullshit.

And though Obama told Congress on Tuesday that his budget team has "already identified $2 trillion in savings" to help tame record budget deficits, about half of those "savings" are actually tax increases, administration officials said. A big chunk of the rest of the savings comes from measuring Obama's plans against an unrealistic scenario in which the Iraq war continues to suck up $170 billion a year forever.

"They've painted the worst-case scenario in order to make it as easy as possible to improve on," said Maya MacGuineas, president of the bipartisan Committee for a Responsible Federal Budget, which champions deficit reduction. "This budget is more realistic than we've seen in the past, in that it actually includes all the policies the administration is supporting. But I'd like to see them go much further in terms of fiscal responsibility in actually closing that deficit gap."

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[Thor]

Inquiring minds want to know.........



where in the hell is he going to get all of this money ?!?!?!?!?? (besides from the raping of the American citizens ??)

[Chris_]

Inquiring minds want to know.........



where in the hell is he going to get all of this money ?!?!?!?!?? (besides from the raping of the American citizens ??)

They print money in DC, don't they?

[Wretched Excess]

this may be a futile effort, but let's try to keep all of the budget threads in one place.  we were having the same conversation in three places.  I merged the thread from BN into this one, as well.

[Wretched Excess]

the multinationals will simply move their headquarters . . . to other countries.

President Takes Aim at Foreign Profits

WASHINGTON -- President Barack Obama has proposed a dramatic tax increase on the foreign profits of U.S. multinationals, in a 10-year budget blueprint released Thursday.

The tax increase on foreign income, taken together with proposals to crack down on offshore tax cheating, would swell federal coffers by an extra $25 billion a year in revenue by 2014, according to projections by White House budget officials.

The budget plan would also impose a $31.5 billion tax increase, over a 10-year period, on oil companies, by repealing various tax breaks now enjoyed by the sector. In addition to that, Mr. Obama would reinstate Superfund taxes, raising $17.2 billion over 10 years, much of which is accounted for by excise taxes on oil.

Those changes are part of a package that would raise taxes on business by $353.5 billion over the next 10 years, which could help fund other tax cuts or spending, or reduce the deficit.

"The budget also begins to restore a basic sense of fairness to the tax code, eliminating incentives for companies that ship jobs overseas and giving a generous package of tax cuts to 95% of working families," Mr. Obama said in his budget message.

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[Chris_]

Hey Uncle Zer0, tax the UN!   

[Wretched Excess]

I am sure there is something horrible in the fine print.  this seems too sane

Obama proposes modest defense increase

WASHINGTON (AP) — President Barack Obama wants only a modest increase in defense spending.

His proposal of at least $533.7 billion is only a 4 percent increase from estimated 2009 spending. Such a sizable sum shows the new administration plans to take a moderately conservative approach to the nation's defense.

But some weapon systems may take big cuts as officials and contractors decide how existing programs fit into that budget after adjustments for inflation.

Obama's request to Congress on Thursday also includes a separate $205.5 billion for the wars in Iraq and Afghanistan between now and fall 2010. More than a third of the war money — $75.5 billion — would be spent before October, when the new budget year begins.


Link

[Chris_]

I am sure there is something horrible in the fine print.  this seems too sane

That's a lot of white flags to be purchased from the French.

[Chris_]

Inquiring minds want to know.........



where in the hell is he going to get all of this money ?!?!?!?!?? (besides from the raping of the American citizens ??)

Heard the best answer to that on Rush this morning.

Teh One doesn't care.  The point isn't to find a way to pay for this.  The point - as it is for all intellectual elitists - is to exert CONTROL over the American people by making the debt hole that much deeper.

[Wretched Excess]

the really scary part is that the president's budget is typically just the starting point for the congress.  it only goes up from there.

[The Village Idiot]

how many hours ago did he promise to cut the deficit in half??

[Wretched Excess]

how many hours ago did he promise to cut the deficit in half??

40-odd.

[Wretched Excess]

interesting piece on the potential cuts for each service:

Here is a breakdown of what analysts see as key considerations for each service in the months ahead:

Army: With the Iraq war winding down, the army faces serious equipment shortages as units return home. "Resetting the force,"the military's jargon for rehabilitating and replacing worn out equipment, will cost tens of billions of dollars, experts predict. President Obama already has endorsed plans to continue expanding the army; an additional sixty-five thousand soldiers will be added to the service's ranks in coming years. Secretary Gates told lawmakers in January 2009 the goal is to increase the army to the point where soldiers will be given two years off for every year of deployment (PDF). Beyond Iraq, the chief question mark for the army will be the survival of the service's cornerstone modernization program, the $161 billion Future Combat Systems (FCS). McAleese predicts FCS will be "heavily scrutinized" in the forthcoming budget cycle. Intended as the next step away from the lumbering army divisions of the Cold War era, the program would provide new vehicles, sensors, and weapons to the army's slimmed-down, brigade-based force structure. But the program has been besieged by cost overruns and performance setbacks. It faces a key review in 2009, though the U.S. Government Accountability Office has already recommended that "viable alternatives" (PDF) be considered.

Air Force: Efforts to expand the service's airlift capabilities could see increased Pentagon dollars in the Obama administration. The White House has expressed concern for the service's shortfall in aerial refueling and airlift capabilities, and vowed "greater investment in advanced technology ranging from the revolutionary, like Unmanned Aerial Vehicles and electronic warfare capabilities, to essential systems like the C-17 cargo and KC-X air refueling aircraft." By contrast, with Washington seeking to shift focus from conventional, large-scale conflicts to hybrid counterinsurgencies in Iraq and Afghanistan, tactical aircraft programs--high performance fighter aircraft, for instance--may fare much worse. The $67 billion F-22 Raptor program, the Air Force's most advanced and priciest warplane, tops the list of possible cuts. Pentagon officials, including Secretary Gates, have opposed the service's requested 381 planes, and in February 2009 Air Force Chief of Staff Gen. Norton Schwartz acknowledged that the service's target will be somewhat less than 381. The White House has until March 1, 2009, to decide whether to increase the fleet beyond (WSJ) the 183 already cooked into the books. Yet trimming the sails on the F-22 (and possibly the F-35 as well) will likely be opposed in legislative districts where the planes are manufactured. "Do you cut this program at a time when you're spending billions of dollars to create jobs when in fact these are jobs already in place?" Rep. David Scott (D-GA), whose congressional district includes Lookheed Martin's F-22 plant, told the Atlanta Journal-Constitution. "This is the wrong place to cut at this time."

Navy: Plagued by shipbuilding delays and cost overruns, analysts say they expect the navy to turn their focus to relatively "affordable" ships, such as the Arleigh Burke class DDG-51, the NSSN new attack submarine, and the LPD-17 amphibious transport. Setbacks in the navy's $27 billion Zumwalt class DDG-1000 destroyer program, by contrast, reflect endemic design and execution troubles that plague many of the service's efforts to design next-generation warships (PDF). McAleese predicts that the DDG-1000 "is in great danger," especially if the service sticks with plans to reorient toward the DDG-51. Senior navy officials already have decided to scale back production of the DDG-1000 to two ships, from a previous high of thirty-one, though some officers say this is shortsighted. James Lyons, former commander of the U.S. Pacific Fleet, writes in the Washington Times that the decision "has left the Navy's future shipbuilding plans in troubled waters," and may have sunk a key component of any future anti-ballistic missile intercept capability. McAleese says other likely shifts include slowdown in production of the Boeing P-8 Poseidon anti-submarine aircraft; and extending the life of older navy aircraft, including the variants of the carrier-borne F/A-18 fighter.

Marines: Like the army, the Marine Corps faces staffing, equipment, and procurement challenges. A 2006 assessment of the service's equipment needs by the Center for American Progress found that nearly half of the Marine Corps' assets had been shipped to Iraq; replacement and repair costs could run upwards of $20 billion dollars. To defray these high costs, some analysts say the corps should divert funding from the controversial V-22 Osprey, a troubled tiltrotor transport aircraft, and instead fund the purchase of new H-92 and CH-53 helicopters. Doing so could save the Marines more than $10 billion over the next five years, says a 2007 budget assessment (PDF) prepared by the Institute for Policy Studies. Critics have also called for the cancellation of the troubled Expeditionary Fighting Vehicle program. Additionally, McAleese says the Obama Pentagon is likely to review the Joint Light Tactical Vehicle, which is being developed in partnership with the army.

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[Carl]

Dow down 88 points....thanks President Marx.

[The Village Idiot]

Dow down 88 points....thanks President Marx.

let it settle in. Tomorrow there be bloodletting

[Wretched Excess]

military contractors will be in free fall tomorrow, as soon as the world digests the fact that you can't increase the effort in afghanistan, retain troop levels in iraq, and remain flat to budget without hacking the guts out of major acquisition and development projects.

[Chris_]

how many hours ago did he promise to cut the deficit in half??

Business hours?