Tales from the Trail

Obama lets the budget ax fall — but gently

President Barack Obama has been threatening to crack down on government spending and on Thursday he let the budget ax fall — but gently.
 
He unveiled $17 billion in cuts as part of his administration’s budget for the 2010 fiscal year.
 
OBAMA/BUDGET“We can no longer afford to spend as if deficits don’t matter and waste is not our problem. We can no longer afford to leave the hard choices for the next budget, the next administration — or the next generation,” Obama said.
 
$17 billion.
 
That would be about one half of one percent of his $3.55 trillion budget.
 
Nearly 1.5 percent of the projected 2010 deficit.
 
And about $1 billion less than what President George W. Bush proposed to cut from the previous year’s budget.
 
By comparison, the American family with a median income of about $51,000 a year looking at a 0.5 percent budget cut would need to trim $255.

Asked to explain the discrepancy between the president’s tough words and his meager cuts, White House spokesman Robert Gibbs said the administration was only just beginning to go through the budget line by line to eliminate waste.
 
“Our budget will bring non-defense discretionary spending to the lowest level as a share of our GDP since we began keeping records in 1962,” he said. “We’ll cut the budget deficit in half in four years and put ourselves — put this country — back on a path toward fiscal sustainability.”
 
The White House then sent round a release from Senator Tom Coburn praising the cuts. Coburn is a notorious Republican budget hawk — and Obama friend — who has repeatedly bottled up legislation in the Senate complaining about its cost.
 OBAMA/BUDGET
Other Republicans were less charitable.
 
Senate Republican Leader Mitch McConnell called them “modest spending reductions totaling a fraction of a percent of the trillions his budget would add to the debt.”
 
So what are the president’s budget-cutters planning to chop?
 
The educational attache to UNESCO in Paris. Gone. (Let ‘em use teleconferencing, Obama says.)
 
Fixing up the nuclear accelerator building at Los Alamos. Forget about it — the research they do is important for Obama’s energy independence plans, but they can live in the building as it is.
 
The super-duper helicopter that would replace the president’s current fleet — chopped back by about 90 percent.
 
And more.

So what do you think — are the cuts just token? Or has Obama made a real start toward getting a handle on federal spending?
 
For more Reuters political news, click here.

Photo credit: Reuters/Kevin Lamarque (Obama speaks about budget cuts);  Reuters/Jonathan Ernst (Copies of the budget book on display)

from Global News Journal:

Obama gets rockstar welcome at town hall meeting

President Barack Obama on Wednesday stepped out from behind the podium, took off his suit jacket and dispensed with the teleprompters to defend his budget, attack Republicans who label him a tax-and-spend Democrat and express outrage at the bonuses paid at insurance giant AIG.
 
Obama, who has made no secret of the fact he chafes in the White House "bubble" and enjoys engaging directly with Americans, headed west to California to hold a town hall meeting in Costa Mesa, a town of about 113,000 in Orange County that has been hard hit by the recession. 
 
Obama's critics say his comments expressing outrage at the AIG bonuses and other Wall Street scandals lack passion because they are often scripted and read from a teleprompter.
 
But on Wednesday, Obama sounded like he was back on the election campaign trail as he rounded on Republicans for criticizing his $3.5 trillion 2010 budget, which he says is crucial to tackling the worst economic crisis in decades.
 
"Most of these critics presided over a doubling of the national debt. We are inheriting a $1.3 trillion deficit. So they don't have the standing to make this criticism, I think, given how irresponsible they've been,"  he said.
 
Under the glare of hot lights in an uncomfortably warm hall at Costa Mesa's state fairgrounds, Obama invited his audience to ask him questions and feel free to take him to task and tell him if he was a "bum and doing a bad job".
 
But there was little danger of that. When he entered the hall, he received a rockstar welcome.
 
Obama at times spoke with passion, his voice rising above the cheers, while he was at times professorial, explaining credit default swaps and mortgage-backed securities and breaking his promise to keep his answers short as he explained how and why America's economy had plunged to such depths.
 
Despite the fact that he has only been in office two months, one of the first questions he fielded was from a woman asking him if he would run for re-election in four years' time.
 
"I would rather be a good president taking on the tough issues for four years than a mediocre president for eight years," he replied.
 
And if he fails to deliver on his promises on health care, education and fixing the economy, then it will be the voters and not he who decides whether he runs again.

For more Reuters political news, click here.

Photo credit: Reuters/Larry Downing (Obama at town hall meeting in California)

Think the U.S. deficit is bad? Check out the interest payments

US TREASURY PAULSONFor those who are worried about the $1.75 trillion deficit that President Barack Obama projected the government would run in fiscal 2009, wait until you see what the interest on the growing U.S. debt will be.

The U.S. debt is roughly $10.6 trillion and the government spent $253 billion servicing it last year. With the mounting yearly deficits, that cost is skyrocketing.

During the debate over the $787 billion economic stimulus plan aimed at pulling the U.S. economy out of its downward spiral, Republicans argued that the cost was really over $1.1 trillion because of the cost to service the additional debt.