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The President's Budget Spends, Taxes, and Borrows Too Much - Stifling Job Growth Today and Threatening our Economic Future

House Budget Committee & Senate Budget Committee Republican Summary of President’s FY2012 Budget

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Washington, Feb 14, 2011 | comments

In challenging times, a chief executive must lead. But President Obama has failed to confront the fiscal and economic challenges before us. Instead, he continues down the same unsustainable path: growing the government, weakening the economy, and increasing the burden of debt on each and every American.

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Spends Too Much: $8.7 Trillion In New Spending

 

Despite this year’s $1.6 trillion deficit, the President still refuses to change course and reduce spending. Under his budget, the size of government will nearly double since the day he took office. Ignoring both economists’ warnings and the public’s demands for restraint, the President’s explosive growth of government crushes private-sector investment, fuels uncertainty for job creators, and guarantees a less prosperous future for all Americans. The price tag of the President’s budget for the next ten years:

Total spending: $46 trillion; $8.7 trillion in new spending
New entitlement spending, beyond assumed growth: $404 billion
Increase in non-defense discretionary spending since 2008: 24% (excluding stimulus)Increase in discretionary spending above President’s own deficit commission: $353 billion
Spending this year under the President’s budget: Record $3.8 trillion; 25.3% of GDP (highest since WWII)

Taxes Too Much: $1.6 Trillion In New Taxes

The President’s big-government vision imposes a heavy cost: diminishing economic opportunity through massive tax hikes that depress wages and stifle job creation at a time when millions of Americans remain out of work. In total, the President’s budget imposes $1.6 trillion in new taxes on families, small businesses, and job creators, including:

Income tax hike: $919 billion
Death tax hike: $118 billion
Transportation tax hike: $435 billion

Borrows Too Much: $13 Trillion Added To The Debt

Despite the urgent need to rein in our runaway debt, the President’s budget doubles debt held by the public by the end of his term and triples it by the end of the decade. Gross debt will eclipse the size of the entire economy this year and remain above 100% of GDP for every single year that follows. This crushing burden of debt is depressing economic growth today, yet the President’s budget fails to seriously meet this challenge and instead accelerates our country down the path to bankruptcy:

New debt: $13 trillion
Gross debt by end of decade: $26.3 trillion (107% of GDP)
Annual interest payments by end of the decade: $844 billion
Total interest payments on debt: $5.7 trillion

A Failure Of Leadership

The President’s budget represents an abdication of leadership by failing to address the drivers of our debt crisis and the unsustainability of our entitlement programs. He even ignores the recommendations of his own bipartisan fiscal commission while continuing to increase spending across the board. Instead of fulfilling his campaign promise to cut the deficit in half in his first term, the President’s budget doubles the debt over that same period of time. We are racing in the wrong direction and the President’s foot remains stuck on the pedal.

The unsustainable growth of government dims the economic prospects of millions of Americas by reducing jobs, discouraging new investments, and threatening our nation’s financial security. The true cost of the President’s budget goes beyond the trillions of dollars squandered – it also includes lost opportunities for future Americans because this President chose to hide from tough choices and retreat from the principles that have made America great.

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