Fact Check: The President’s Budget Reduces Future Deficits by $273 billion, Not $4 Trillion

Senator Jeff Sessions (R-AL), the Ranking Member of the Senate Budget Committee, has released a handy chart that shows just how misleading the President’s budget really is. When using honest budgeting techniques (that is, not relying on gimmicks and rosy assumptions), it turns out that the President’s budget only shaves $273 billion off of future deficits. It does not reduce the deficit by $4 trillion over the next 10 years. When added up correctly, we see the following:

Deficit Effect of the President’s Fiscal Plan

(2012–2022, in trillions of dollars)

President’s Math

Honest Math

-1.551

-1.551

Tax Increases

1.195

Eliminate BCA Fallback Sequester

-0.848

Savings from Ending War

-0.646

-0.646

Savings from Other Programs

0.354

0.354

New Stimulus Spending

0.125

0.125

New Surface Transportation Spending

0.438

Freeze Medicare Physician Payments

-0.407

-0.188

Interest Savings from Lower Debt

-2.973

-0.273

Total

We already knew that in addition to “cutting” the deficit, the President’s budget would also increase spending. What we didn’t know was just how deceptive the deficit reduction would be. According to Sen. Sessions:

  • It does not count the cost of replacing the $1.2 trillion sequester (spending reduction plus interest savings) required under current law. This is plainly true because the president eliminates the reductions required by the law that he signed and replaces it with tax increases. Then he fails to score the cost of repeal, a monumental deception.
  • It counts the inevitable winding down of the war costs in Afghanistan—all of which is borrowed—as $1 trillion in spending reduction; and
  • It buries the $522 billion cost of freezing the Medicare physician update in the baseline, without identifying any source of funds to pay for it.

Removing all the gimmicks leaves us with yet another massive spending plan that will raise taxes and ignore the main drivers of our soaring deficits.

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