One of the largest and fastest growing items in President Obama’s new budget is often overlooked. Net interest expenses will skyrocket over the next decade, growing by 250 percent.
President Obama’s budget would raise taxes to fund a $478 billion infrastructure spending plan for highways, transit, and other items. The budget (on page 26) cites an International Monetary Fund study that “highlights the importance of choosing high-efficiency infrastructure projects based on rigorous benefit-cost analysis.”
The president released his budget request this morning. As expected, his plan is heavy on new spending and new taxes, and very light on structural reforms.
On Monday, the White House will release President Obama’s budget proposal for Fiscal Year 2016. The president is expected to reemphasize his previous fiscal approach of higher spending coupled with higher taxes, while completely ignoring the country’s long-term fiscal problems.
Republicans say they favor cutting regulations to spur growth and create jobs. And they generally favor expanding international trade. They can attain those goals by reforming labor union laws.
Reading some Frederic Bastiat last night, I circled his observation that the government takes advantage of citizen passivity to increase its power, often by promising to “cure all the ills of mankind.” The government initiates “in the guise of actual services, what are nothing but restrictions; thereafter the nation pays, not for being served, but for being disserved.”
The launch of HealthCare.gov in 2013 was a disaster. A new report from the Health and Human Services Inspector General (IG) describes how the department mishandled the website’s construction. The department failed to follow federal contracting rules, and did not have a cohesive plan for the website. This led to cost overruns and project delays, and HealthCare.gov’s eventually rocky start.
Tonight, President Obama will deliver the State of the Union address. In addition to the lofty rhetoric and self congratulations, the president will likely claim that the federal government’s budget has improved during his tenure.
President Obama’s economic policies always seem to be a zero-sum proposition with winners and losers. Usually the losers are all Americans, who suffer from slower economic growth.
With the highway bill soon in front of Congress, and there being lots of agitation to increase federal funding, Adam Smith had words of wisdom for policymakers. He advocated user-pays and decentralization.