President Obama's 2012 budget is not a serious governing document. It's a political one, designed to boost his re-election chances.
By repeatedly saying that his budget reduces the deficit by $1 trillion over 10 years, he hopes the numbers make him sound fiscally conservative. But he puts off 95% of the deficit reduction until after his term ends in 2013. And he assumes that economic growth in the next few years will be at least 25% higher than credible economic forecasters estimate.
Mr. Obama's budget includes $1.6 trillion in tax increases that are real enough—but most of the spending cuts are not. For example, as Rep. Paul Ryan, the House Budget Committee chairman pointed out to me, the administration projects war costs for Iraq and Afghanistan at surge levels for the next decade, and then conjures up about $1.3 trillion in defense savings by assuming drawdowns in each theater—drawdowns that were already in the cards. Outside of this sham transaction, according to Mr. Ryan, there are only $104 billion in real spending cuts over the next 10 years.
Moreover, the administration simply ignores entitlements. This is a dereliction of duty, although it has a certain political logic: The budget is not meant to be taken seriously—it's meant to be quickly forgotten so that the administration can turn attention to, and attack, what congressional Republicans do about federal spending.
Mr. Obama wants House Republicans to take the lead in cutting current spending and proposing future restraint in entitlement and other mandatory spending. He's betting that letting Republicans take the lead will cripple them. This misreads public opinion. But it is plausible to believe that Republican mistakes can help revive Mr. Obama's political fortunes. So it's important that the GOP offers real budget cuts without coming across as angry and frenetic. Republicans need to patiently show what they are doing and why, and to express their sadness and disappointment over Mr. Obama's failure of leadership.
Congressional Republicans need to make methodical and sensible recommendations for cutting discretionary outlays and restraining future entitlement spending. They must explain to the public why the Obama budget will lead to our nation suffering horrific tax increases, massive austerity cuts, and real human suffering. They need to show that the president's fiscal path is, to use a favorite word of his, unsustainable.
Tactically, Republicans should respond to Mr. Obama's agenda as they did to his infatuation with high-speed rail projects. Three days after Vice President Joe Biden touted the magical balm of high-speed trains, House Appropriations Committee Chairman Hal Rogers released the continuing resolution for the balance of fiscal year 2011.
It cut the rest of this fiscal year's high-speed rail funds, rescinded $3.5 billion appropriated in previous fiscal years but still unspent, and rescinded $3.75 billion in unspent transportation money from the 2009 stimulus, almost all of it from Mr. Obama's high-speed rail plan. Overall, nearly $8 billion was cut from transportation, but none from vital road projects that are real priorities for the states.
The result: Very few Americans believe the billions Mr. Obama wants for speedy trains from Milwaukee to Madison, or Columbus to Cincinnati, will spark economic recovery. This still leaves transportation spending higher than it was two years ago, when Mr. Obama came into office. Republicans can reasonably ask the public: Are we better off with all the spending and red ink Mr. Obama has added over the past two years?
There will be dozens of such confrontations in the months ahead. How Republicans handle these opportunities will go a long way toward determining how popular their agenda is. Politics involves optics as well as policy ideas.
The evidence of the federal government's budget woes is so overwhelming that Americans are ready for tough actions. They understand that failing to make cuts now and to restrain entitlements in the years ahead will doom our children and grandchildren—indeed our country—to a future less prosperous and less free.
This article originally appeared on WSJ.com on Wednesday, February 16, 2011.
