Issues

OMB Director Challenged to Resign After Refusing to Answer Budget Question

This Ain’t Rocket Zients

Following the release of President Obama’s budget request for fiscal year 2013, the most expensive in United States history, Office of Management and Budget director Jeffrey Zients refused to say whether the president’s budget would increase federal spending over the next decade.

"Do you propose to spend more money over the next 10 years than what the Budget Control Act and current law would cause us to spend?" asked Sen. Jeff Sessions (R-Ala.) during a hearing of the Senate Budget Committee on Tuesday.

The Budget Control Act (BCA), legislation arising from the debt-ceiling compromise last August, capped total spending over the next 10 years at $47.053 trillion.

However, after incorporating the superficial "savings" included in the president’s budget—such as the re-appropriation of war funding that would never have been spent ($848 billion), fully accounting for Medicare reimbursements that are not paid for ($429 billion), and the resulting reduction in interest payments on the debt ($224 billion)—the figure becomes $45.552 trillion.

Obama requested $46.959 trillion in federal spending over the next decade, an increase of $1.4 trillion compared to the BCA. Compared to last month’s estimate from the Congressional Budget Office—$44.251 trillion—the president’s budget calls for a $2.7 trillion spending increase.

But Zients could not answer the question.

"I think what we have is a much more honest baseline," he said.

When Sessions pointed out that the net effect of the president’s plan was to increase spending above current law, meaning the BCA, Zients objected.

"I want to be crystal clear here," he said. "We are complying by the BCA, there will be $2 trillion of deficit reduction from the BCA."

However, the president’s budget is relatively murky in its treatment of the BCA, taking credit for $1 trillion in savings that have already been signed into law, and therefore should not be counted as such. The budget also removes the $1.2 trillion sequestration—automatic spending cuts put in place following the failure of the so-called "super-committee" to agree to a deal—and replaces it with a tax increase of equal size.

A visibly irritated Sessions toughened his line of questioning:

SESSIONS: Well let me ask you this. If you are incorrect in saying that you do not increase spending more than the current law would you consider resigning your current office?

ZIENTS: Let me go back to the balanced approach

SESSIONS: We looked at the numbers. Are you that confident?

ZIENTS: I’m confident that with our baseline, which accurately reflects current policy and business, as usual that we have deficit reduction of more than $4 trillion. And we do it in a balanced way. For every $2.50 of spending cuts there’s a dollar of revenue. That’s a good balanced approach.

SESSIONS: Mr. Zients, there are no spending cuts in this budget. This budget increases spending. Surely you know that. It increases taxes. So to say you cut $2.50 in spending for every dollar in tax increase is beyond the pale.

Once all of the budget gimmicks and superficial savings in the president’s budget are accounted for, critics say, the true amount of deficit reduction is not $4 trillion over the next decade but closer to $300 billion.

Stephen Miller, Sessions’ communication director, reacted with astonishment at the exchange.

"In one of the most revealing—and stunning—moments of the 2012 budget debates, President Obama’s budget chief was at first either unable or unwilling to answer a very fundamental question from Sen. Sessions over whether the President’s budget increased or decreased spending relative to the levels agreed to under the Budget Control Act," he said. "Ultimately, he did provide an answer—only it was wrong. What reason would the White House have for not simply telling the American people that their budget plan increase total spending above those levels set in August?"