David Stockman: Obama Oblivious to Deficit

David Stockman, the former congressman and Reagan-era budget director, blasted President Barack Obama on Wednesday for going “radio silent” on offering genuine proposals to rein in deficit spending.

Stockman’s diatribe on MSNBC echoed the complaints of fiscal conservatives, who said the president’s speech seemed strangely out of touch with the reality of deteriorating federal finances.

“I think it was very disappointing,” Stockman said of the speech. “It’s part of the general situation where Washington is dreamwalking and not facing the hear-and-now of this huge problem.”

On Wednesday, the Congressional Budget Office reported that this year’s federal deficit will reach an all-time high of $1.5 trillion, compared to last year’s $1.3 trillion.

At current spending levels, the CBO said, the national debt that consumed 40 percent of GDP in 2008 will rise to 70 percent of GDP by the end of this year. And that sea of red ink doesn’t include the debt rung up by state and local governments.

According to Stockman, Obama’s proposal to freeze non-security, discretionary federal spending -- which amounts to about 12 percent of the federal budget -- “will have almost no measureable effect.”

Real spending constraint, he said, must begin with major budget items.

“We need massive reform of our Medicare and Social Security entitlement system, a means test for the better-off elderly among the 53 million beneficiaries -- he [Obama] didn’t even mention the word,” said the former head of the Office of Management and Budget.

Stockman, a habitual gadfly to conservatives, also called the president’s plans to cut Pentagon spending “a pinprick.”

The former Michigan congressman said that a “huge reduction and demobilization” of the defense establishment is needed to balance the budget.
Stockman said the president either has to cut spending or “level with the American public that we’re going to have to substantially increase taxes, not just on the rich but across the board, if we’re going to begin to pay our bills and close this $1.5 trillion deficit that we’re having this year and will have many years in the future.”