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The Republicans' Next $2.7 Trillion Lie

February 21, 2009

As the New York Times detailed this week, the Obama administration will end George W. Bush's fuzzy math when it comes to the federal budget and budget deficit. But by accurately reflecting the true costs of the wars in Iraq and Afghanistan, Medicare reimbursements, disaster responses and the AMT, the Obama White House is now projecting an extra $2.7 trillion increase in debt over the next decade. Which means that the groundwork has been laid for the Republicans' next lie.
In recent weeks, the GOP and its conservative echo chamber have propagated the falsehood that President Obama is planning to cut defense spending. In reality, the preliminary Obama budget calls for boosting non-war Pentagon funding by $40 billion to $527 billion, an 8% increase over the FY 2009 level. As CQ noted three weeks ago, that didn't stop Fox News and friends from birthing the defense cut myth:

"Some Pentagon officials and congressional conservatives are already trying to portray the OMB number as a cut by comparing it to a $584 billion draft fiscal 2010 budget request compiled last fall by the Joint Chiefs of Staff."

As it turns out, the right-wing fraud was so blatant that even the reliably Republican Hot Air blog was forced to admit, "If that was what Fox did, then they should apologize."
But that deception will pale in comparison to the next big lie doubtless coming from the Republican Party. The upcoming Obama budget's realistic depiction of fiscal reality instead will almost be greeted by conservative cries that the President is expanding the debt by $2.7 trillion over the next 10 years.
As Peter Orzag, former head of the Congressional Budget Office and now Obama's chief at OMB, put it, "The president prefers to tell the truth, rather than make the numbers look better by pretending." To be sure, as the New York Times detailed, the extent of President Bush's shell game was staggering:

A budget that is $2.7 trillion deeper in the red over the next decade than it would otherwise appear, according to administration officials.
The new accounting involves spending on the wars in Iraq and Afghanistan, Medicare reimbursements to physicians and the cost of disaster responses.
But the biggest adjustment will deal with revenues from the alternative minimum tax, a parallel tax system enacted in 1969 to prevent the wealthy from using tax shelters to avoid paying any income tax.

But in yet another of stunning hypocrisy from a GOP which laughably calls itself the party of fiscal discipline, Republicans will simply blame Obama for telling the truth. The conservative amen corner will ignore the inconvenient truth that the national debt doubled under Ronald Reagan, only to double again under George W. Bush. And while it was Reagan's OMB alchemist David Stockman who in the 1980's first resorted to the "magic asterisk" and the "rosy scenario," it was the Bush White House which cooked the books to produce Dubya's bogus 2004 promise (later broken, of course) to halve the budget deficit by 2009.
Like the inescapable truth that Wall Street and the economy almost always do better under Democratic presidents, the history of Republican mismanagement will be swept under the rug. Still, the GOP will lay at Obama's feet both the looming $1.5 trillion '09 deficit (swollen by urgently economic stimulus spending) and the costs associated with honesty in government accounting. And no doubt, as with the defense spending fraud, much of the media will dutifully parrot the charge.
UPDATE: The Washington Post on Saturday offered a preview of the upcoming Obama budget proposal. It features his own plan to halve the deficit by the end of his first term by preserving the estate tax, letting the Bush tax cuts for the wealthiest Americans expire and through reduced costs for the war in Iraq.


Jon Perr
Jon Perr is a technology marketing consultant and product strategist who writes about American politics and public policy.

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