The White House Delays Its Budget

President Obama will delay the release of his budget for the government's 2012 fiscal year by about a week. It should be sent to Congress and the public on or around Feb. 14, according to the Administration.

The White House said a delay in the confirmation of the new budget director, Jack Lew, was partially to blame. Another reason given was that Congress was late to make government funding decisions at the end of this year.

The President may have a difficult time getting his budget passed as Republicans will try to block a number of spending proposals in the name of reducing the deficit.

At the core of the budget debate will be whether government spending can continue to stimulate the economy. The extension of previous tax cuts, which follows the government's huge stimulus package of two years ago, may help rebuild GDP growth, but many economists are doubtful of that. They say chronic unemployment and a stumbling housing industry will undermine long-term improvements.

These issues will cause both parties to examine again which spending cuts are prudent to trim the budget deficit and which will harm an economic recovery. Any improvement in consumer and corporate activity, in turn, will eventually increase tax receipts to the IRS from both businesses and individuals. That, in theory, will bring the federal budget gap down.

It hardly matters whether the budget is late. What does matter is how the wrangling over its content turns out.


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kenneth

Why does Obama even bother to submit a budget request to the Congress. Speaker to be Boehner should pronounce it Dead Before Arrival and instruct the Budget Committee to develop a budget, giving little or no attention to what Obama wants. The Republicans have the votes in the House to ram it through, and it does not require the signature of the President. Of course, Dirty Harry Reid can be blocked in the Senate by a filibuster from advancing anything. Besides, who needs a budget? The 111th Congress did not adopt one for FY2011 and they muddled through. Just proceed to the Appropriations Bills for FY2012 (let the FY2011 year play out on a continuing resolution).

December 28 2010 at 12:46 PM Report abuse -1 rate up rate down Reply
Trevor

1) Since government spending neve stimulated the economy is the first place, it's impossible for it to "continue" to stimulate the economy. Sure, if the government forces expenditures in certain economic sectors that would have realized lower levels of activity absent the forced expenditures, those sectors may well create some jobs. But the entirety of govenment expenditures represent resources generated via taxation or borrowing, and therefore would have been spent or invested anyhow. The reduced expenditures on the part of citizens resulting from increased government borrowing or taxation cost jobs in the same manner that the increased spending in other sectors may have created some jobs. The only difference being that the increase in jobs came in sectors where govenment goons picked winners and losers, while the reduction in jobs came in sectors that would have otherwise enjoyed demand by virtue of resource allocation decisions made by citizens. The only question is who is the more carreful, wise, efficient and productive allocator of the fruits of citizens labor? Foggy bottom goons, or the citizens themselves? 2) Employment is not a CAUSE of economic activity. Rather it is an EFFECT of economic activity. 3) Housing is very likely to be additive to GDP in 2011 as the home building industy continues to rebound from very low levels.

December 28 2010 at 10:11 AM Report abuse +1 rate up rate down Reply
phasejump

President Obama has done a great job as the President! Things are really starting to improve thanks to Obama policies

December 28 2010 at 9:15 AM Report abuse -4 rate up rate down Reply
3 replies to phasejump's comment
ajallenky

Budget, smudget !! This administration now has to write it's third budget of it's lifetime - remember Obummer was an attorney block organizer with Jesse Jackson on the South Side of Chicago who once picketed the homes of the President of the Bank of America to humiliate him into making TOXIC loans to people who should not have had them - then once he gets into the White House he distances himself from this bad PR and conveniently doesn't discuss this when he bashes the " Greedy Bankers ". He is just as much in bed with the barracudas on Wall St. as ANYONE - and for some reason some portion of the public keeps their blinders on and keeps falling for his silver tongued speeches !!!

December 28 2010 at 9:05 AM Report abuse +2 rate up rate down Reply
1 reply to ajallenky's comment
phasejump

Your garbage is made up right? You thought that garbage up yesterday

December 28 2010 at 9:17 AM Report abuse -4 rate up rate down Reply