In his last piece, Phil – to use an expression picked up over Feb Orientation – “yucked my yum.” He took us through what he painted to be President Obama’s “harmful budget,” paying special attention to the tax increases, ending of sequestration and community college plan. While I won’t address all of these issues because each subject deserves its own article entirely, I will say this: President Obama’s new budget proposal is a step in the right direction. Though it is not perfect, it cuts America’s deficit and decreases our debt, all while increasing funding to programs that desperately need it.
For starters, let us establish that, thanks to tax increases and, therefore, more revenue, the proposal would flatten deficits out to around two and a half percent of gross domestic product (GDP.). This is significant because under current policies the deficit would actually increase beginning in 2018. Furthermore, the proposal cuts our debt back to 73 percent of G.D.P. rather than the 79 percent it was estimated to reach by 2025.
You may be thinking (especially if you lean right like Phil), “OK, that’s great that the deficit and national debt would decrease, but do we have to do that through tax increases? Why not just cut spending?” The answer to that question is that we cannot afford to. Let’s zoom in on the issue of infrastructure.
America used to have the best infrastructure in the world. Our bridges, our rails, our electrical grids, et cetera were better than the rest of ‘em. This is no longer the case. Because of insufficient funding, 77,373 of our 604,493 bridges have become functionally obsolete and 69,517 have become structurally deficient. They are, on average, 42 years old. The American Society of Civil Engineers (ACSE) gave U.S. infrastructure the letter grade, “D+.” In a 2013 study, the ASCE estimated that we needed around $3.6 trillion by 2020 to bring all U.S. facilities back up to par.
So, yes, Obama might be asking for a whopping $4 trillion in this new budget plan, but just $478 billion of that is going to public works programs. In other words, of the $3.6 trillion the ASCE recommended for infrastructure, Obama has tightened the purse strings so much that not only is he giving them less than a quarter of what they asked for, but he is also spending the amount that one department needs on the entire federal budget. It might be easy to say that Democrats are the party of big spenders; however, the new budget proposal illustrates that while Democrats indeed want to spend more than Republicans, they are spending (get this) conservatively and with purpose.
You should know what this increase in government spending is getting us. According to a report by the Congressional Budget Office in 2014, for every dollar invested in infrastructure, the economy grows by $1.15 to $1.25. Additionally, Standard & Poor’s Rating Services released a report in 2014 stating that an immediate $1.3 billion infrastructure investment could add 29,000 jobs to the construction sector and even more jobs to other infrastructure-related industries. The study also found that this investment could boost economic growth by $2 billion and reduce American deficit by $200 million for 2015.
I think we can all agree that no one wants to spend extra money if they don’t have to, but so many programs in the U.S. -— infrastructure, Medicaid, Medicare, et cetera — necessitate the additional spending. The benefits of paying up far outweigh the costs.
Therefore, while it would be great to take the Republican way out — cut spending and leave taxes alone, or even lower them to solve the deficit/debt problems — that plan is infeasible. Our country needs the increased spending and, unfortunately, that may mean raising taxes.
That is why it is all the more important for Republicans to work with the President – so that they have a say in how the taxes will work, and can quit complaining about them. Obama has some pretty palatable ideas. For example, to fund the $478 billion public works program, he has asked Congress to approve a one-time 14 percent tax on profits that American companies have amassed overseas, lower than the standard 35 percent corporate tax rate.
We may all whine and moan about the sad reality that sometimes we have to cough up a little extra dough, but I expect all policy makers in Washington to step up to the plate. Therefore, I hope Phil’s prediction that Republicans will not let this budget go unaltered is incorrect. Furthermore, I hope that the general opinion on Obama’s budget plan will not be tainted with false notions of overspending. For if this article has done nothing else, ideally it has shown you that there are a lot of naysayers or “yuckers” out there, but there is unquestionable “yum” to be gained from President Obama’s new budget proposal.
