President Barack Obama is demanding more than $1 trillion in new spending as part of a deal to avert the so-called fiscal cliff, according to a top Republican Senator.
Sen. Jeff Sessions (R., Ala.), ranking member on the Senate Budget Committee, is taking the White House to task for its "disappointing" effort to mislead the American people on the issues of spending and taxes.
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He is particularly concerned with the president’s desire to undo the so-called sequester—$1.2 trillion in spending reductions (over a decade) scheduled to take effect next year as negotiated in the August 2011 agreement to raise the debt ceiling.
The proposal the White House put forward last week called for doing just that.
Sessions has previously urged lawmakers of both parties to abide by that agreement and ensure that the sequester or a commensurate amount of spending reduction is kept in place.
Obama’s proposal also called for $1.6 trillion in new taxes and additional spending totaling nearly $600 billion over the next decade—$1.8 trillion if you count the eliminated sequester. Additionally, the White House claims to support about $600 billion in spending cuts and entitlement savings.
Republicans roundly dismissed the offer as unserious.
The White House proposal, which was largely based on the president’s unpopular budget, contains a net spending increase of more than $1 trillion, according to Sessions.
That includes $50 billion in new stimulus spending, $26 billion to extend unemployment insurance, and $100 billion to extend the payroll tax holiday. On top of that, eliminating the sequester and paying for the so-called "doc fix"—restoring Medicare reimbursements to physicians—would cost about $1.6 trillion for a total of $1.8 trillion.
Factor in the $600 billion in savings the White House claims to support, and the president’s proposal boils down to a $1.6 trillion tax increase coupled with $1.2 trillion in new spending for deficit reduction totaling just $400 billion over the next decade.
That is equal to about one third of last year’s budget deficit and just 0.025 percent of the current national debt. The Congressional Budget Office reported Friday that the federal deficit for the first two months of fiscal year 2013 reached $292 billion.
The American people should take note, Sessions argued on the Senate floor Thursday.
"I would ask the American people, when you read that Congress was considering—and you’ve heard the president advocate—more taxes, did you not assume that that money would be used to reduce the deficit we have?" he said.
Obama has been vague as to why he wants to raise taxes although he has been clear in his desire to do so.
He wants to use the revenue to "reduce our deficit in a balanced, responsible way" but also to spend it on "investments."
However, the president’s plan is heavy on "investment" and light on "balance." The plan achieves 100 percent of its deficit reduction ($400 billion) by raising taxes in addition to calling for a net $1.2 trillion in new spending.
Sessions contends the president is trying to "confuse the American people" into supporting a plan they otherwise might find troublesome. He doubts most Americans would favor a plan that raises taxes by a significant amount yet fails to reign in federal spending.
Americans oppose new stimulus spending by an overwhelming 62 to 19 percent margin, according to a recent Rasmussen poll.
A survey conducted on behalf of the liberal think tank Third Way found that 95 percent of Obama voters view the federal deficit as a problem and were split 41 percent to 41 percent as to whether it should be reduced mostly through spending cuts or mostly tax increases. Just five percent said they favored reducing the deficit with tax increases alone.
"At some point, we’ve got to stop spending money," said a Republican aide. "The Americans know this. The president needs to get on the same page."