Below you will find two news stories.
The first, from Investor’s Business Daily, is a summary of all of the campaign promises Barack Obama made to the American public. It’s a pretty straight forward list, albeit financially impossible, which brings me to the second story.
USA Today succinctly outlines the grave situation this country faces with regard to the national debt. Given that every American household is now on the hook for $516,348. I think President-elect Obama will find that keeping his promises will either be completely impossible or extremely costly– financially and politically.
INVESTOR’S BUSINESS DAILY
Few presidential candidates have made more specific promises to American voters than Barack Obama. They came so fast and furious in the latter part of the campaign, you’d be excused for not keeping up. So as a public service, we’ve put together a handy checklist of some of the biggest Obama promises — culled from his “Blueprint for Change,” his campaign speeches and advertisements. Clip it. Save it. And see how he did in four years…
Taxes
• Give a tax break to 95% of Americans.
• Restore Clinton-era tax rates on top income earners.
• “If you make under $250,000, you will not see your taxes increase by a single dime. Not your income taxes, not your payroll taxes, not your capital gains taxes. Nothing.”
• Dramatically simplify tax filings so that millions of Americans will be able to do their taxes in less than five minutes.
• Give American businesses a $3,000 tax credit for every job they create in the U.S.
• Eliminate capital gains taxes for small business and startup companies.
• Eliminate income taxes for seniors making under $50,000.
• Expand the child and dependent care tax credit.
• Expand the earned income tax credit.
• Create a universal mortgage credit.
• Create a small business health tax credit.
• Provide a $500 “make work pay” tax credit to small businesses.
• Provide a $1,000 emergency energy rebate to families.
Energy
• Spend $15 billion a year on renewable sources of energy.
• Eliminate oil imports from the Middle East in 10 years.
• Increase fuel economy standards by 4% a year.
• Weatherize 1 million homes annually.
• Ensure that 10% of our electricity comes from renewable sources by 2012.
Environment
• Create 5 million green jobs.
• Implement a cap-and-trade program to reduce greenhouse gas emissions.
• Get 1 million plug-in hybrids on the road by 2015.
Labor
• Sign a fair pay restoration act, which would overturn the Supreme Court’s pay discrimination ruling.
• Sign into law an employee free choice act — aka card check — to make it easier for unions to organize.
• Make employers offer seven paid sick days per year.
• Increase the minimum wage to $9.50 an hour by 2009.
National security
• Remove troops from Iraq by the summer of 2010.
• Cut spending on unproven missile defense systems.
• No more homeless veterans.
• Stop spending $10 billion a month in Iraq.
• Finish the fight against Osama bin Laden and the al-Qaida terrorists.
Social Security
• Work in a “bipartisan way to preserve Social Security for future generations.”
• Impose a Social Security payroll tax on incomes above $250,000.
• Match 50% of retirement savings up to $1,000 for families earning less than $75,000.
Education
• Demand higher standards and more accountability from our teachers.
Spending
• Go through the budget, line by line, ending programs we don’t need and making the ones we do need work better and cost less.
• Slash earmarks.
Health care
• Lower health care costs for the typical family by $2,500 a year.
• Let the uninsured get the same kind of health insurance that members of Congress get.
• Stop insurance companies from discriminating against those who are sick and need care the most.
• Spend $10 billion over five years on health care information technology.
By Dennis Cauchon
USA TODAY
The federal government recorded a $1.3 trillion loss last year — far more than the official $248 billion deficit — when corporate-style accounting standards are used, a USA TODAY analysis shows.
The loss reflects a continued deterioration in the finances of Social Security and government retirement programs for civil servants and military personnel. The loss — equal to $11,434 per household — is more than Americans paid in income taxes in 2006.
“We’re on an unsustainable path and doing a great disservice to future generations,” says Chris Chocola, a former Republican member of Congress from Indiana and corporate chief executive who is pushing for more accurate federal accounting.
Modern accounting requires that corporations, state governments and local governments count expenses immediately when a transaction occurs, even if the payment will be made later.
The federal government does not follow the rule, so promises for Social Security and Medicare don’t show up when the government reports its financial condition.
Bottom line: Taxpayers are now on the hook for a record $59.1 trillion in liabilities, a 2.3% increase from 2006. That amount is equal to $516,348 for every U.S. household. By comparison, U.S. households owe an average of $112,043 for mortgages, car loans, credit cards and all other debt combined.
Unfunded promises made for Medicare, Social Security and federal retirement programs account for 85% of taxpayer liabilities. State and local government retirement plans account for much of the rest.
This hidden debt is the amount taxpayers would have to pay immediately to cover government’s financial obligations. Like a mortgage, it will cost more to repay the debt over time. Every U.S. household would have to pay about $31,000 a year to do so in 75 years.
The Financial Accounting Standards Advisory Board, which sets federal accounting standards, is considering requiring the government to adopt accounting rules similar to those for corporations. The change would move Social Security and Medicare onto the government’s income statement and balance sheet, instead of keeping them separate.
The White House and the Congressional Budget Office oppose the change, arguing that the programs are not true liabilities because government can cancel or cut them.
Chad Stone, chief economist at the liberal Center on Budget and Policy Priorities, says it can be misleading to focus on the government’s unfunded liabilities because Medicare’s financial problems overwhelm the analysis.
“There is a shortfall in Medicare and Medicaid that is potentially explosive, but that is related to overall trends in health care spending,” he says.
Filed under: Politics | Tagged: Barack Obama, Campaign Promises, Debt, President-Elect | Leave a Comment »
