Outlays have been limited under a series of agreements between Obama and Congress, including a 10-year cap on discretionary spending worked out as part of deal to raise the debt ceiling in 2011, said Michael Linden, director of tax and budget policy at the Center for American Progress in Washington.
Republicans Credited
It is Republicans, not Obama, who deserve credit for whatever restraint on spending that’s been achieved, said Douglas Holtz-Eakin, a former CBO director who is now president of the American Action Forum in Washington.
Holtz-Eakin, who served in the White House under George W. Bush, also voiced skepticism that all of the promised budget savings under the spending caps will be attained. The caps cover outlays on everything from defense and homeland security to education and the national parks.
Reischauer, too, has his doubts about the plan. “The public won’t tolerate” the cuts over the coming decade contemplated under the legislation, he said.
Even if the U.S. succeeds in bringing down its deficit to manageable levels in the next few years, it still faces structural spending pressures in the long-run stemming from the aging of the society, according to both Hatzius and Darda.
“The U.S. has a large long-term budget imbalance,” Hatzius said.
Tidal Waves
It’s that threat that Republican lawmakers accuse Obama of ignoring. The “twin tidal waves” coming at the budget are from increased outlays on the Medicare health program for the elderly and Social Security, Senator John Barrasso, a Republican from Wyoming and chairman of the party’s policy committee, said.
“Until you deal with those and reform those programs and strengthen them for future generations, we’re not going to have solved the problem” of the budget, he told Fox News television on Jan. 16.