Tuesday, July 26, 2011

Obama's Debt Ceiling Dishonesty For Beginners

It's getting really difficult for me to listen to President Obama give speeches--and it was tough to being with. As his poll numbers drop lower and lower it seems that his talking points become more and more dishonest. Last night he was true to form.

It was a short speech, but it wasn't short on whoppers and misleading statements. Here's a sampling:

"For the last decade, we have spent more money than we take in. In the year 2000, the government had a budget surplus. But instead of using it to pay off our debt, the money was spent on trillions of dollars in new tax cuts, while two wars and an expensive prescription drug program were simply added to our nation’s credit card. As a result, the deficit was on track to top $1 trillion the year I took office."

While it's true that the debt has grown since the year 2000--and before that-- neither the Bush tax cuts or the war in Iraq were the reason that the deficit was " on track to top $1 trillion the year [Obama] took office." The reason for that staggering number was a combination of lowered revenues due to the recession and the money spent on TARP. Prior to that, revenues had been spiking upward and the annual deficit had been dropping for several years.

When touting his own debt reduction "plan" and getting ready to make the comparison to the GOP plan that actually exists, Obama said:

"The first approach says, let’s live within our means by making serious, historic cuts in government spending. Let’s cut domestic spending to the lowest level it’s been since Dwight Eisenhower was President."

This is only true if one views those cuts in the context of the increases that this administration has already made. The administration has hiked annual spending levels. The cuts that are now being proposed simply adjust the spending to levels lower than they are at now. However, the levels will still be higher than they ever have been before. When the President mentions Ike, he is referring to the precipitous drop in spending following World War II. This comparison is misleading and completely irrelevant to our current situation.

"Republican House members have essentially said that the only way they’ll vote to prevent America’s first-ever default is if the rest of us agree to their deep, spending cuts-only approach."

At this point, anyone who fully understands the situation should know that even if the deadline passes, America will not default on it's debt obligations. There are more than enough revenues coming in to avoid this scenario and there is no doubt that paying our creditors will be the government's number one priority should the deadline hit.

But, it terms of solely blaming the GOP's "approach" for possible default, it takes two to tango. One could just as easily blame the Administration's seemingly intractable demand that taxes be raised if default were to occur. Which it won't.

"If that happens, and we default, we would not have enough money to pay all of our bills – bills that include monthly Social Security checks."

Same scare tactic, only this time aimed at scaring a specific constituency. Social Security checks will most certainly be a funding priority should America pass the deadline. Whether the checks go out is the president's decision, but they most certainly will. Again, there will be plenty of revenues to cover this item.

"I realize that a lot of the new members of Congress and I don’t see eye-to-eye on many issues. But we were each elected by some of the same Americans for some of the same reasons. Yes, many want government to start living within its means. And many are fed up with a system in which the deck seems stacked against middle-class Americans in favor of the wealthiest few."

While it's probably true that the president was elected by people who think this way, members of the new GOP congress were elected by people who reject this type of class warfare and realize that the economic problems of the American middle-class are not in any way related to what the tax-rate is for wealthy Americans.

Call me crazy, but I think honesty in times of crisis is an important trait for the leader of the free-world to have. What we have now is something far different. But he still has the bully pulpit. One has to hope that he is as ineffective in using it to sway public opinion in this case as he was when attempting to sell health care reform.

All politicians play loose with the truth. But not to the extent that this one has in such a relatively short period of time.

- Dan Joseph

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