WASHINGTON — The White House sought today to stress the positive in a looming fight with Congress over a $3.6 trillion budget, saying blueprints put forth by Democratic allies in both chambers hew closely to President Barack Obama’s priorities.
Budget director Peter Orszag said companion fiscal 2010 blueprints emerging from the House and Senate budget panels will bolster administration efforts to give a higher priority to education and clean energy programs as well as taking into account Obama’s desire to overhaul health care. The outlines, however, would leave for a later time difficult decisions on financing his plans to combat global warming and provide millions of Americans with health care coverage.
Orszag, in a briefing for reporters, said the separate plans are “fully in line with the president’s key priorities.” Obama has said that he understands the process will necessitate considerable give and take, but that he doesn’t want to lose sight of the overall goals.
The budget director characterized the emerging plans as “98 percent the same as the budget proposal the president sent up in February.”
Obama has been hearing increasingly vocal opposition to the blueprint he sent to Congress last month, however, and he arranged to travel to Capitol Hill later today to meet with Democrats. Some of the opposition on spending, particularly, has come from moderate to conservative members of his own party.
For their part, Republicans have almost universally assailed his spending plan as overly ambitious, saying it would dump trillions in debt on future generations.
While the budget plans that Democrats started pushing through Congress largely mirrored Obama’s blueprint, the plan advanced by Senate Democrats employs some sleight of hand — such as assuming a $400 tax cut for most workers and $800 for couples will not be renewed beyond 2010 — to cut projected deficits to a more sustainable level.
In a conference call with reporters in advance of Obama’s Hill visit, Orszag said the proposals coming from the budget panels mirror Obama’s. And he said the administration was studying ways to simplify the U.S. tax code, seeking to close loopholes with an eye toward further budget savings.
Meanwhile, House Minority Whip Eric Cantor of Virginia charged that Obama’s budget is “so far out of the mainstream” that even members of Obama’s own party are reluctant to support it.
Cantor said that it puts too many taxes on businesses and that policymakers must “provide relief to the job creators.”
Both the House and Senate budget chairmen have been forced by worsening deficit estimates to scale back Obama’s requests for domestic programs, while deeply controversial revenues from his global warming initiative won’t be included either.
In the House, Budget Chairman John Spratt Jr., D-S.C., said his companion blueprint would employ fast-track procedures to allow Obama’s overhaul of the U.S. health care system to pass Congress without the threat of a GOP filibuster in the Senate.
Democrats point out that Obama inherited an unprecedented fiscal mess caused by the recession and the taxpayer-financed bailout of Wall Street. Rather than retrenching, however, they still promise to award big budget increases to education and clean energy programs, while assuming Obama’s plans to overhaul the U.S. health care system advance.
“The best way to bring our deficit down in the long run is … with a budget that leads to broad economic growth by moving from an era of borrow and spend to one where we save and invest,” Obama said in a Tuesday night news conference.
It’s also becoming clear that Obama’s controversial global warming initiative has experienced a setback, as neither House nor Senate Democrats are directly incorporating into their budget plans Obama’s controversial “cap-and-trade” system for auctioning permits to emit greenhouse gases.
Conrad’s plan was released in the wake of new Congressional Budget Office estimates that predicted Obama’s plan would produce alarming estimates of red ink — $9.3 trillion over 10 years and a deficit of $749 billion in 2014. Obama’s budget promises a $570 billion deficit in that year, and to get below that figure Conrad was forced to make a series of difficult choices.
Conrad said his budget makes room for Obama’s hopes to deliver health care to the uninsured. He said the plan would not add to the deficit over the long haul.
In grappling with the deficit, Conrad would cut Obama’s proposed increases for next year for domestic agencies funded by lawmakers to growth of about $27 billion, or 6 percent. Over five years, the savings from Obama’s budget would be $160 billion.
But Conrad also makes several shaky assumptions, especially that Congress will raise taxes by about $114 billion over 2013-14 to make sure middle-class taxpayers won’t get hit by the alternative minimum tax. He also saves $87 billion by promising Congress will come up with spending cuts or new revenues to avoid cuts in Medicare payments to doctors.
Both problems have been fixed in recent years by using deficit dollars.
Under Congress’ arcane procedures, the annual congressional budget resolution is a nonbinding measure that sets the terms for follow-up legislation.
Neither budget includes Obama’s $250 billion set-aside for more bailouts of banks and other firms.
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