WASHINGTON — The nonpartisan Congressional Budget Office, official scorekeeper of fiscal Washington, estimated that President Barack Obama’s proposed 2013 budget would largely do what it says: add another $6 trillion-plus to deficits over the next decade.
That said, the red ink will be slightly less than the White House projected — about $300 billion lower than the estimates from Obama’s team — a welcome finding for the administration after CBO last year found a substantially higher budget deficit than the White House envisioned.
Obama’s budget proposed tax hikes on certain corporations and wealthier Americans (those earning beyond $200,000 annually or $250,000 for couples), a drawdown in war spending and other policy changes. Debt, now at $15.3 trillion, would rise to nearly $19 trillion by 2022.
Even with the increased debt load, annual deficits under Obama are projected to decrease from the record highs during the recession — when lower tax revenues coupled with increased government spending sent budgets out of balance. Last year, CBO estimated deficits would total $9.5 trillion over the decade.
“It confirms that the president has a balanced plan to reduce our budget deficits and put the country on a fiscally sustainable path, which is critical to constructing an economy that is built to last,” Jeff Zients, director of the Office of Management and Budget, wrote Friday on the office blog.
Still, the annual assessment provided a reminder that the nation’s debt is expected to continue to climb to what budget hawks view as alarming levels unless substantial tax-and-spending changes are enacted.
Congressional Republicans, who are preparing their own budget blueprint, seized on the report as indicative of Obama’s inability to rein in the national debt.
“Today’s analysis serves as a disappointing reminder of this administration’s broken promises and failed leadership when it comes to averting the most predictable economic crisis in our history,” said Rep. Paul Ryan, R-Wis., the chairman of the House Budget Committee.
As in past estimates, CBO found that perhaps the best approach to reining in annual deficits would be for Congress to do nothing.
Under existing laws, taxes on wealthier and middle class Americans would rise early next year as the George W. Bush-era tax cuts expire. Also, federal defense and domestic spending would be slashed as part of the accord reached last summer between Congress and the White House raise the debt ceiling.
If those and other existing laws were allowed to stand, the CBO estimates that federal deficits would shrink to less than $3 trillion over the decade.
The public debt load as a percentage of gross domestic product would be 61 percent — what many economists characterize as a safe zone — compared with 76 percent under the president’s budget.
Those laws, however, are politically unpopular among both Democrats and Republicans, and Congress is expected to change them — ensuring the annual deficit — and debt — would continue to rise.