Washington, D.C. - The following is a statement by Steve Bell, Senior Director of the Economic Policy Project at the Bipartisan Policy Center, regarding the Fiscal Year 2015 federal budget released by President Obama today: “President Obama’s budget unfortunately continues a holding pattern on current federal fiscal policy. This again confirms that the president and Congress are unwilling to make hard choices and address the fundamental drivers of deficits and debts in years ahead.
“While the president’s health entitlement proposals are noteworthy, they fail to fundamentally reform the fastest growing portion of the federal budget. This lack of reform as we face a demographic wave of aging Americans remains a fatal flaw in the budget.
“The president’s budget recognizes that our economy continues to struggle and that the global economy has stagnated. Therefore, the president proposes a new $56 billion Opportunity Growth and Security Initiative that is paid for. In addition, the president advocates more spending on training and education, science and health research, modernization of defense procurement and research, and other programs funded annually by appropriations.
“These proposals recognize that most of the deficit reduction of the past four years has been in programs that invest in future economic growth. Continuing to squeeze these programs, which make up the smallest and slowest growing part of the federal budget, is counterproductive, and we are pleased to see the president reject this approach.
“The president also emphasizes limiting tax deductions and exceptions for the wealthiest Americans, including a 30 percent minimum income tax on millionaires. Despite a tax increase of around $1 trillion and an outline for revenue-neutral corporate reform, the budget avoids fundamental tax reform that flattens and simplifies the tax code for individuals. It would be naïve to assume that in an election year, in which control of the House and Senate seems to be at stake, any president would tackle the kinds of fundamental tax and entitlement reforms advocated by the Bipartisan Policy Center’s Domenici-Rivlin Debt Reduction Task Force.
“We do hope that following the elections some incremental bipartisan agreements can be reached and the president’s FY 2016 budget submission will contain a full-scale debt stabilization plan. The president and Congress should take advantage of that window of opportunity after the elections.”