Barack Obama, whom at this point seems to be a shoo-in for the White House, certainly has high hopes. He has plans for multiple new government projects, totaling around $200 billion each year. Barack claims to have carefully calculated exactly where all the money to fund these projects will come from; which is primarily from ending the war in Iraq and increasing taxes on the wealthiest two percent of Americans. The problem is, however, that there is simply no way that this plan can add up to still include tax cuts for the majority of middle class Americans.
Some of the highlights from Obama’s plan, quoted from the Washington Times, include a $65 billion-a-year health plan, $15 billion in green energy spending, $85 billion in tax cuts and credits, a $25 billion-a-year increase in foreign aid, and $18 billion a year in education spending. This American government- plagued by overspending for the past 8 years under George Bush- would now have Barack Obama at the helm of government overspending. To quote Joe Biden, “That’s not change! That’s more of the same!”
Unfortunately for Obama, there simply is no money to spend. Raising taxes during this sort of recession, even if it is only on the upper strata of Americans, is a dangerous move. Obama has set his goals much too high, especially with America’s current economic crisis. If Obama does happen to get his way with these spending plans, the brunt of the tax burden will ultimately be shifted off to the middle class, as it always is. The wealthiest simply do not have enough to give, no matter how much Obama plans on taxing them.
The problem with the American voter is that no one is asking these questions. Everyone just seems to be willing to believe Barack Obama when he claims that he will come up with the money to fund these grand programs and cut their taxes. Unfortunately for them, Barack Obama’s big plans simply do not add up.
http://www.washingtontimes.com/news/2008/feb/22/obamas-spending-plan/
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3 comments:
Ray Gun, it's true that Obama's spending plans seem far-fetched, idealistic, and perhaps impossible to bring to fruition. America is buried in debt, and it seems that achieving Obama's lofty goals would only exacerbate our overspending woes. But I think this analysis is a bit one-sided.
It's important not to neglect that McCain's spending plans are just as unreasonable. According to FactCheck.org, as cited by MSNBC, though "Obama's spending plan is not matched by comparable projected revenue increases," McCain's goals would similarly increase the national debt - by a margin of between $5.1 trillion and $7.4 trillion over the next ten years! Note that McCain has "promised to balance the budget by 2013." While I admit that all of Obama's spending plans are a bit unreasonable considering our economic position, his opponent is also guilty of such exaggeration.
We must consider the nature of campaign promises; they are never entirely fulfilled, serving merely to represent the goals of the candidates. Furthermore, no matter whom the next president may be, we will not witness drastic changes immediately anyway, as the multi-billion dollar initiatives such as revamping health care would not be launched right away, and the War in Iraq will certainly not disappear. Therefore, let us not examine the spending line-by-line but consider, more qualitatively, what the candidates prioritize and the changes they seek to create.
Nice post, Ray Gun, but I take a more optimistic approach.
It is true that Obama wishes to spend more than $200 billion more per year, while simultaneously cutting taxes. However, because of the economic recession, this is not irresponsible, but required. For example, when President-elect Roosevelt entered the oval office in 1932, the United States' economy was probably at its worst ever; we face a similar--though not as grave--situation now.
In 1932, Roosevelt, following so-called Keynesion macro-economic theory, dramatically increased the size of government, deficit spending on projects from social security to power plants. Though the United States did go into further debt from these projects, Roosevelt's New Deal, as well as increased employment from World War 2, lifted the United States from the throes of economic collapse.
Obama, making history this past Tuesday, should take a page from it during his presidency, and offer governmental relief programs.
Sounds like his $200 billion increase in spending will do just that.
Playdoh, the Keynesian policies pursued in the New Deal were not effective in curbing the effects of the recession of 1929. In fact, if you read a Monetarist History of the United States by Milton Friedman and Anna Schwartz, you will find a very strong case that the policies pursued in the New Deal if anything prolonged the conclusion to the recession. As Friedman wrote, "The Fed was largely responsible for converting what might have been a garden-variety recession, although perhaps a fairly severe one, into a major catastrophe. Instead of using its powers to offset the depression, it presided over a decline in the quantity of money by one-third from 1929 to 1933 ... Far from the depression being a failure of the free-enterprise system, it was a tragic failure of government.”
Obama's "plan" may do precisely that. While I am always in favor of cutting taxes, I do not believe that the government should attempt to "prime the pump" by increasing needless spending. Especially if what is necessary is an adjustment of monetary policy.
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