Obama's Tax Plan Would Balloon Deficit, Study Finds

On the campaign trail, Sen. Barack Obama bashes President Bush for "reckless" economic policies that are "mortgaging our children's future on a mountain of debt." But the Democratic presidential candidate has adopted a key component of Bush's fiscal policy: A novel bookkeeping method that guarantees that the $9.5 trillion national debt will get much bigger.

When Obama promises to cut taxes for the middle class without increasing the deficit, he is measuring his proposals against the large deficits that would result from Bush's plan to extend his signature tax cuts beyond their 2010 expiration date. Because Obama wants to eliminate some of the Bush tax cuts, he would bring more money into the Treasury, permitting him to pay for new programs without increasing the deficit even more.

But under current law, all the tax cuts expire and the deficit disappears completely. Democrats in Congress have vowed to preserve the Bush tax cuts only if they can cover the cost and keep the budget in balance. Measured against current law and against the promises of his fellow Democrats, Obama would rack up huge deficits. According to a recent analysis by the nonpartisan Tax Policy Center, Obama's tax plan would add $3.4 trillion to the national debt, including interest, by 2018.

Read the whole story here.

Comments

[barackobama4prez]

And several more experts agree with his course of action. Can't please them all, but pray tell...the scrutiny would have been more useful when Dubya was inflating our dollar, no?

[SaltySaltillo]

I am not sure what motivated the Post to spin this article at this time, but this study has been out for awhile, and while the Obama plan adds to the debt, the Mccain plan in the same study, adds a couple trillion dollars more to the debt (but you have to read several paragraphs into the article to get there). So why is Obama at the headline?

[BlueIndiana]

From the article:
"Obama economic advisor Jason Furman said Obama compares his tax plans to Bush's instead of to current law because it draws a clear distinction with Republican Sen. John McCain, who wants to keep all the Bush tax cuts and add even more. According to the Tax Policy Center, McCain's tax plans would increase the national debt by at least $5 trillion over the next 10 years."
One would hope that the HuffPo would avoid endorsing misleading media memes by repeating them without qualification.

[CharlesJ]

This is interesting, there was a report just a week ago that stated it was a great plan, so who is right. For every report that says it's no good, I can find someone to say the fiscal plan is great. A general out line is a wish list so to speak, nothing is set in stone and if anyone believes it is I have some land off the coast of Oregon that will fill your needs. Facts are any economic plan released now will be tweeked, masaged, re written and rehashed to meet budget paramaters. Regardless of who gains the WH, they know they can no longer fail to be fiscally responsible, that the can no longer fail to perform their expected duties and they must without exception put the American people at the top of all lists. Even above their Own Political Career Asperations.

[rollingdivision]

And this study doesn't include the costs of his plan to provide "free" health care to 25+ million illegal aliens.

[KQuarksSuperKollider]

Both candidates plans are not fiscally responsible (even though McBush's plan is far less fiscally responsible) because no candidate can ever tell the truth about taxes because the Rethuglicans have made it part of their campaign strategy never to raise taxes when they are needed. That is part of the never ending campaign that Scott McClellan talked about. That being said if you are going to run up huge deficits anyway where would your rather see the money go from tax cuts or spending.

McBush would give more tax breaks to the rich and corporations and increase spending on war.

0bama will take some tax breaks away from the rich and corporations and give more tax breaks to the middle and low classes and spend more on affordable health care, alternative energy developments and education.

[joebhed]

People pay too much attention to the Grover Norquist philosophy on shrinking the size of government through reducing taxes (AND increasing DEBTS).

Reducing the size of government is not an end game.
Reducing the power of an economic democracy is the end game.

The people of a sovereign nation act in their own collective best-interests through their voting powers.
My Dad used to tell me there are only two things that matter in this world, money and votes.
Always excepting love, of course.

It is by FORCING the government to continue to take on DEBT in the name of the American taxpayers that those taxpayers become enslaved to the monied interests, or those who Martin Van Buren always referred to as those with THE MONEY POWER.

I know a lot of posters are into this 'political" struggle between the parties.
Because that's all we can do.
It's that voting thing that my Dad mentioned.

But the Rothchild's don't really care which PARTY is in power.
Do you know why?
"Permit me to issue and control the money of a nation and I care not who makes its laws. - Mayer Amschel Rothchild

That quote from hundreds of years ago is even more true today.

Mc-Cain or Obama - same difference to those who want to continue the destruction of economic democracy in America.

Maybe Obama would be better.

But I'm voting Ralph Nader.

[iswideopen]

This is your opinion. Were you at the meeting with Senator Obama and Warren Buffet? I didn't think so. If I have to go off of a cliff, you're doggone skippy I choose to go off that cliff with Barack and Warren. Obama has the judgement to know that taking care of American families first is the most urgent matter to be tackled; the budget comes next. I wouldn't be voting for him if he were looking at this situation any other way. Change is ongoing, we are not so ignorant as to think it will happen overnight. I guess you like republican Arnold Schwarznegger's approach; lay off workers and pay the rest of them minimun wage with the stroke of a pen. It took McCain=Bush 8 years and running to create this madness. We are looking at the end result which will be ALL GOOD FOR AMERICA AND AMERICANS . YES WE CAN!!!!!!!!!

OBAMA '08

[jay1975]

Wow, the Obama defenders are out in full force. Both candidates are proposing more than we can afford. Whether it is tax cuts or social medicine, we cannot afford it even if we left Iraq next week. Neither candidate has come out with a real plan to balance the budget, they both both just propose more spending. If they really cared about balancing the budget they would be preaching about ending the needless spending of our tax dollars by the congress for BS. From the "bridge to nowhere" to the commision to celebrate the bicentenial of the War of 1812, our congress is wasting our hard earned money. The congress is the cause of our economic woes. From authorizing Iraq to their non-action on energy costs we can see where there priorities lie and it is not for you and I.

[joebhed]

not an Obama defender here.

To suggest that the Congress is the CAUSE of our economic woes is a joke.

The cause of our economic woes is the disastrous DEBT-money economic system that has over-extended itself by an order of magnitude over its ability to pay back.

There is a reason that our capitalist economies live by their own self-described virtue of growth.
Each year ALL new money that comes into existence comes into existence as DEBT.
Not just the government's DEBT, but, all DEBT.

Given that today we the taxpayers and consumers owe about $50 TRILLION in REPAYMENT OBLIGATIONS to the holders of that debt, both public and private, and given that ALL NEW MONEY that is created every year comes into existence as DEBT, then where are we ever going to get the money to repay that DEBT?

By issuing more debt?
As Obama and McCain want to do?
And, which the Congress MUST do themselves to continue to get financial support and voter support?

We cannot.

The jig is up.

The only viable solution is to restore to the Congress the power to create CREDITS rather than DEBTS, and use those payments for things like health, education, welfare, infrastructure, social security and medicare, and, yes, alternative energy policy.

Put the bankers back into the business of lending their own money at interest.

And put the American taxpayer back in control of creating their debt-free economic democracy.

Monetary reform NOW.

[fourex]

"But under current law, all the tax cuts expire and the deficit disappears completely."
Whoever wrote the above sentence at the Washington Post should be taken out and flogged.

[Mildmannered]

I agree

[joebhed]

Too bad its only a plan.

It really disgusts me that there are articles on the bizpages about the FREAKING HUGE public debt in this country, now about $9.7 TRILLION, and that only what we taxpayers have borrowed.
We need to pay back about $20 TRILLION -PLUS, because that's how it works with debt-money.

Then there's the private debts of the consumers - around another $10 TRILLION, so another $20 TRILLION-PLUS to pay back there by American consumers.

Then there is the fact that EVERY DOLLAR of new money in this country MUST come into existence as DEBT, so we need to have MORE DEBT to pay back the TRILLIONS in DEBT we already have.

But the real missing link in this feel-good article is this:
Who is going to lend the American taxpayer ANOTHER $4 - $8 TRILLION just so we can go on pretending that nothing is really F*&%#ed UP about our national economy?

So, to put it bluntly - Mr Free-Spending Obama has a plan that needs a partner that does not exist.

And, Mr. Tax-Cutting McCain has a plan that needs a partner that doesn't exist.

But the two politicians have the masses drooling for another bite out of their own hides, as Wall Street gets set to sink its teeth into those hides via the coming monetary contraction.

Wake up America.

And, somehow, be glad, that these are only the PLANS of the politicians.

[Roshi98]

To those of you decrying this article as a "hit piece", wake the f**k up - it's spot on! While Hillary was campaigning under the premise of pay-go, Obama was claiming that every working-class American would wake up on inauguration day with money lining their pockets. Really? And where would that money come from? With no plans to trim ANY government programs (including the perennially expanding DOD), increase our military presence in Afghanistan (sorry, this would probably fall under the rubric of an "emergency supplemental", so it wouldn't count - LOL), and expand health care, clearly, any thinking person would comprehend that the deficit would increase under such a regime.

Again, no new taxes, tax cuts, and no cuts to existing programs equals HIGHER DEFICIT. What is it you people aren't getting here?

And, yes, John McCain would be worse on this (as with every other) front. That's not the point, The point is that a LIBERAL organization has concluded that Obama's proposals would ALSO mushroom the national debt 3.4tr by 2018.

I'll vote for him in November, but this is one Hillary supporter who continues to say, "we told you so!"

[Mildmannered]

And what programs would Hillary have cut?

[Triciann]

McCain has promised to keep the Bush tax cuts and not let them expire so this article uses a false premise. Most experts agree Obama's plans are fiscally more responsible than McCain's. Those with the power, and I don't mean the government, are getting desperate.

[thinklib]

Oh my goodness! Somebody pointed out something negative about one of Obama's proposals! This cannot be allowed! We must outlaw such actions! Everyone must fall in line!

Off with the writer's head!

[Yohomegirl]

Check the facts, ya ijit! http://www.washingtonpost.com/wp-dyn/content/story/2008/06/09/ST2008060900950.html
Lori has it bass-ackwards!

[Yohomegirl]

No, but everyone needs to not distort the truth to further whatever agenda they might have. Check out the link to Wapo below.

[jalapeno]

This article sux!!!!!

It is NOT accurate at all....

!!!

[Yohomegirl]

Dooh Nibor is the name of McCain's tax plan. It's a puzzle.