President Obama said this regarding our dismal budget outlook last night:
Our budget had a 10-year projection — and I just want everybody to be clear about this: If we had done nothing, if you had the same old budget as opposed to the changes we made in our budget, you’d have a $9.3 trillion deficit over the next 10 years. Because of the changes we’ve made it’s going to be $7.1 trillion. Now, that’s not good, but it’s $2.2 trillion less than it would have been if we had the same policies in place when we came in.
Now what in the world is this all about? When it analyzed President Obama’s budget in March, the Congressional Budget Office said roughly the opposite of this: that precisely because of his budget, the deficit over ten years would total $9.3 trillion, while it would have been about half that if not for his budget. Here’s CBO (from page 11 of this PDF):
From 2010 to 2019, the cumulative deficit under the President’s proposals would total $9.3 trillion, more than double the cumulative deficit projected under the current-law assumptions embodied in CBO’s baseline.
It seems Obama’s comment last night was a revival of the ridiculous gimmick he tried out when his budget was first released. The figure he cites for the baseline assumes that Iraq war spending would be at 2008 levels forever, that Medicare physicians’ fees would rise at 1% per year forever (when he’s simultaneously promising to cut them), and that 2009, with its massive bailouts and stimulus, will serve as the normal baseline year for appropriations from here on. Meanwhile, his figure for his own deficits assumes robust growth starting more or less immediately, which seems rather unlikely.
The president wanted to give the impression that his predecessor had set us on a course for a $9.3 trillion budget deficit. It would certainly be very worrisome if a president set such a course…and of course, a president has.