House Budget Committee Chairman Paul Ryan of Wisconsin did something Tuesday that President Obama, Senate Majority Leader Harry Reid and other Democratic congressional leaders refuse to do — propose a 2013 federal budget that makes the hard choices needed if America is to regain its economic vitality and avoid becoming Greece. At least Obama did propose a 2013 budget earlier this year; Reid and his Democratic colleagues in Congress haven’t done that in three years. Unfortunately, the president’s approach makes all the wrong choices, opting to increase spending, taxes and debt without regard to the consequences. Worse still is the fact that the Obama budget, if adopted, would add immensely to the difficulties facing his successors in the Oval Office, to say nothing of the children and grandchildren of today’s taxpayers.
On spending, for example, the Obama budget increases federal spending every year, for a total of $1.5 trillion over the next decade. Ryan’s “Path to Prosperity” decreases federal spending by $3.5 trillion. On the federal deficit, not only does Obama propose the fourth-straight year with a federal deficit of at least $1 trillion, his budget projects oceans of red ink as far as an accountant’s eye can see. The Ryan budget goes in the opposite direction by progressively reducing the deficit by $3 trillion over a decade, compared with the Obama proposal, and puts the government’s ledger on the way to being balanced thereafter.
On the national debt, which currently stands at nearly $17 trillion, the Obama budget piles an additional $11 trillion (assuming that China and other international creditors will lend us the money), while the Ryan approach reduces the debt every year for the next decade and makes it reasonable to foresee it being eliminated entirely by 2050. Finally, and perhaps most significantly, the federal government’s share of the gross domestic product would swell to 23 percent and remain there or higher for the foreseeable future if the Obama budget became law. Under the Ryan plan, the government share of GDP would drop to 20 percent and remain at that level or less in the following years.
To put all this data in an understandable format, readers are encouraged to study the chart that accompanies this editorial. While it was made available by the House Budget Committee, the chart simply graphs data provided by the Congressional Budget Office and the Office of Management and Budget. Note that the red ink of national debt produced by the Obama budget blows past 100 percent of GDP by 2020 and then literally goes off the chart. The debt under the Ryan approach — the green area of the chart — does the exact opposite, decreasing every year thereafter. The two budgets represent starkly different visions of the role of government — and of America’s future.